FabTech is undergoing many changes. We have been in business more than 15 years. The company has grown steadily using few systems and formal processes. We are at the tipping point where the “old way” is giving way to the “new way.” Now which way?
Like many start-ups, our company developed many habits over time to deal with the challenges of serving customers while controlling costs. Communications are never a challenge when there are only 5 or 6 people in a business. Everyone knows what everyone else is doing. Forms, process flow, quality checks, lean manufacturing and other tools are just built in. The challenge comes with success. When you go beyond 10 people in any venture, you need to put some formal processes and tools in place.
FabTech has tripled in size over the last few years. We have added staff on the plant floor and in the office. We have grown market share and our capabilities. The challenge is making the transition from “seat of the pants” to “organized and accommodating.” The market is demanding ever more speed, quality and flexibility from us. Glaziers are getting that pressure from general contractors who are getting it from architects and owners and so on and so on and so on.
Fortunately, we have a good crew of old hands and new blood. The veterans have been pretty open to the new ideas. Sure, there has been some gnashing of teeth when some of the old ways get tweaked. This has been minimized with the launching of profit sharing for all associates. Funny how a little cash for success can get everyone rowing in the same direction.
The price of putting some formal processes and tools in place is well worth it. In the chaotic world of commercial construction, those who are better, faster and less expensive win. Others better watch out!
Do you have any stories about transition stages in your business? If you are willing to share challenges, solutions or anecdotes, let me know. I am sure others would enjoy reading some war stories.
A quick shout out to Paul Bieber. He is another blogger for USGNN. I had the pleasure of meeting Paul at the Glass Expo Midwest. We had a great discussion about the industry and our backgrounds. It was very enjoyable to get to know Paul a little better. He really knows the market and how to run a glass business. Thanks Paul for the lunch and the company. You can check out his blog here.
I hope everyone has a great Holiday Season. Stay safe and enjoy the time with friends and family.
Wednesday, December 17, 2008
Tuesday, November 25, 2008
Strategic Planning
It is that time of year. Every business owner and manager is faced with the daunting task of planning for the following year. This year, the stakes are especially high and the risks are lurking everywhere. So, where is an entrepreneur to begin?
We (entrepreneurs) are “shoot from the hip” types as a breed. Howe ever, the annual planning process is an area where random firing will miss your target. You must be willing to be flexible, but having a firm plan in place is essential.
Sure, virtually every business has a sales target and/or profit target going into next year. Or, do you? Does your planning include a firm goal of sales and profit by month? Do you have specific people in your company assigned to be accountable for each expense item? If you do, you are among the few leaders who have full accountability, responsibility and authority alignment.
Sure, virtually every business has a sales target and/or profit target going into next year. Or, do you? Does your planning include a firm goal of sales and profit by month? Do you have specific people in your company assigned to be accountable for each expense item? If you do, you are among the few leaders who have full accountability, responsibility and authority alignment.
There are many systems and tools that can be used as a structure for your planning process. I have used several. Among those I have used are: the lean thinking system from the Toyota Production System, the MBO method and the “seat of the pants” method.
At FabTech, we recently embarked on the planning process. We started with a teambuilding exercise that included blowing off some steam with the ownership and top management. It was not quite like the AIG spa boondoggle, but did help us get in the right frame of mind. The next day, we worked through a robust process that helped us identify, in detail, the strengths and weaknesses of our company. And, MOST IMPORTANTLY, the detailed steps to address weaknesses and build on strengths to meet the needs of our customers.
The real work comes at the start of the year when your plan must be a living system not just a document in your drawer or a sign on the wall. Whatever system you use, use it!
On a personal note, I am very thankful for the support of many people that have made my first year in the architectural fenestration market so rewarding and fun. Props to the team at FabTech, our valued supplier partners and customers for their support and patience teaching a blond, Polish guy the ropes.
Most of all, I am grateful for the love and support of my wife Jean and 4 children. They have been incredible in their patience and understanding. Can’t wait to sit down to the turkey dinner …
We (entrepreneurs) are “shoot from the hip” types as a breed. Howe ever, the annual planning process is an area where random firing will miss your target. You must be willing to be flexible, but having a firm plan in place is essential.
Sure, virtually every business has a sales target and/or profit target going into next year. Or, do you? Does your planning include a firm goal of sales and profit by month? Do you have specific people in your company assigned to be accountable for each expense item? If you do, you are among the few leaders who have full accountability, responsibility and authority alignment.
Sure, virtually every business has a sales target and/or profit target going into next year. Or, do you? Does your planning include a firm goal of sales and profit by month? Do you have specific people in your company assigned to be accountable for each expense item? If you do, you are among the few leaders who have full accountability, responsibility and authority alignment.
There are many systems and tools that can be used as a structure for your planning process. I have used several. Among those I have used are: the lean thinking system from the Toyota Production System, the MBO method and the “seat of the pants” method.
At FabTech, we recently embarked on the planning process. We started with a teambuilding exercise that included blowing off some steam with the ownership and top management. It was not quite like the AIG spa boondoggle, but did help us get in the right frame of mind. The next day, we worked through a robust process that helped us identify, in detail, the strengths and weaknesses of our company. And, MOST IMPORTANTLY, the detailed steps to address weaknesses and build on strengths to meet the needs of our customers.
The real work comes at the start of the year when your plan must be a living system not just a document in your drawer or a sign on the wall. Whatever system you use, use it!
On a personal note, I am very thankful for the support of many people that have made my first year in the architectural fenestration market so rewarding and fun. Props to the team at FabTech, our valued supplier partners and customers for their support and patience teaching a blond, Polish guy the ropes.
Most of all, I am grateful for the love and support of my wife Jean and 4 children. They have been incredible in their patience and understanding. Can’t wait to sit down to the turkey dinner …
Wednesday, November 19, 2008
Now What
The election is over, the Dow is still crazy, the Middle East is a mess and businesses are still innovating and investing. Am I alone in my confidence with our country and small business as the engine of growth?
Sure, we have problems—plenty of problems. From mortgage and bank failures to threats from China and India, the landscape is rocky. However, the entrepreneurs I talk to are still doing what they do best. They are tightening their belts and going back to basics: managing cash, raising productivity, keeping a sharp eye on collections and talking to customers to get a pulse on the market. We all need to keep an eye on what brought us here in the first place.
By our nature, entrepreneurs are optimists. The glass isn’t half empty. In fact, when 75 percent is gone, most of us see it as a 25 percent opportunity to improve and adjust. However, they aren’t outrageously confident.
The winning companies are those who aren’t afraid to adjust when real market conditions demand downsizing. Sometimes, winning strategies aren’t related to huge top line growth, but maintaining bottom line profit in the face of difficult conditions.
Commercial glazing contractors, suppliers and partners have a unique chance to work on the tough plans while still enjoying a backlog. We all need to be aware that the tide may be retreating and start working on our contingency plans BEFORE crisis stage.
If anyone has suggestions, tips, or tools that might help, please contact me or post a comment below.
Now, for a break in the election coverage. What are we all going to watch to replace coverage like this or that? At least, we can get a preview of our future Wall Street executives…
Sure, we have problems—plenty of problems. From mortgage and bank failures to threats from China and India, the landscape is rocky. However, the entrepreneurs I talk to are still doing what they do best. They are tightening their belts and going back to basics: managing cash, raising productivity, keeping a sharp eye on collections and talking to customers to get a pulse on the market. We all need to keep an eye on what brought us here in the first place.
By our nature, entrepreneurs are optimists. The glass isn’t half empty. In fact, when 75 percent is gone, most of us see it as a 25 percent opportunity to improve and adjust. However, they aren’t outrageously confident.
The winning companies are those who aren’t afraid to adjust when real market conditions demand downsizing. Sometimes, winning strategies aren’t related to huge top line growth, but maintaining bottom line profit in the face of difficult conditions.
Commercial glazing contractors, suppliers and partners have a unique chance to work on the tough plans while still enjoying a backlog. We all need to be aware that the tide may be retreating and start working on our contingency plans BEFORE crisis stage.
If anyone has suggestions, tips, or tools that might help, please contact me or post a comment below.
Now, for a break in the election coverage. What are we all going to watch to replace coverage like this or that? At least, we can get a preview of our future Wall Street executives…
Tuesday, September 30, 2008
Bailout Response
Bailout? Rescue? Investment? What we call it is not as important as how it may impact all businesses and consumers. But don’t worry; the politicians will solve all our problems …
As I write this, it is early in the morning of September 30th—the morning after the 777-point fall in the Dow. The talking heads are all buzzing—from both sides of the aisle.
I am interested in the opinions of the folks who stop by this blog. I have my thoughts that I will share with a summary in my next entry, but want to open it up for comments and insights from the readers.
As I write this, it is early in the morning of September 30th—the morning after the 777-point fall in the Dow. The talking heads are all buzzing—from both sides of the aisle.
I am interested in the opinions of the folks who stop by this blog. I have my thoughts that I will share with a summary in my next entry, but want to open it up for comments and insights from the readers.
- As this is posted, the market will have reacted to yesterday. Where will the Dow end up the year?
- Has the “credit crunch” impacted your business? If so, how? Tighter line of credits? Pullback on expansion capital? Freeze on hiring? Or none of the above?
- As a business owner, how do you feel the presidential campaign is addressing your concerns? Do you think either candidate will help or hurt your profits?
- What are your thoughts on the government’s plan? Should there be a cap on compensation for Wall Street executives who get “bailed out?” Should the free market reign and let those who got too highly leveraged fail? Is it too little? Too much?
- Lastly, I would love to get predictions on the commercial glazing prospects for 2009 and beyond.
I think the glazing market will continue provide opportunity for businesses that add value and service their customers. Sure, it will get harder—fewer projects, tighter financing and more competitors. However, partners who can help their customers increase their bottom line will always find a way to survive.
Your thoughts? Post them here or email me at pchojnacki@yourfabech.com. Please let me know if you are willing to share your comments publically. I will post them here soon.
Take care and hold on tight—it will be a wild ride!
Wednesday, September 17, 2008
Time to Go to Vegas
Sin city. Where everything is bigger—the swimming pools, casinos, hotels, restaurants and other things we can’t mention in this forum. Oh by the way, there is a trade show too…
As a veteran of many shows in several industries, I thought I might give some thoughts on getting the most out of attending trade shows. For many years, I have been on the “other side” of the show booth. Like many marketing folks, I have done my share of show set-up and organizing. Their goal is to get qualified leads and network with other industry professionals.
Now, I am one of the target attendees. Yes, you all know who you are. You have the badges that are the right color—the one that all the exhibitors flock to for the scripted lines. However, don’t get turned off by the forum. You can get a lot out of the show if you have the right plan.
You need to do a little homework prior to getting on the plane. Look at the website or show guide to set your top 5 things you want to accomplish. This list can include things on the show floor, classes or seminars, networking dinners/drinks/lunches or a combination of the above. Many times, people come to shows with no plan and get caught up in things that are time wasters. How many times have you found that on the last day of the show you are frustrated by how busy you were but feel like you didn’t get done what you want?
However, don’t get too programmed. Don’t be one of those people who follows their checklist and plow through 3 days with every minute planned. You will see new things and meet new people. Leave time to explore and wander. Leave time to arrange an impromptu meeting or meal with a new prospect or vendor. Keep an open mind.
Finally, have fun. It is a good time to get away from the daily grind and blow off some steam. But remember, this is Vegas, so pace yourself; don’t end up like this guy …
See you on the Strip.
As a veteran of many shows in several industries, I thought I might give some thoughts on getting the most out of attending trade shows. For many years, I have been on the “other side” of the show booth. Like many marketing folks, I have done my share of show set-up and organizing. Their goal is to get qualified leads and network with other industry professionals.
Now, I am one of the target attendees. Yes, you all know who you are. You have the badges that are the right color—the one that all the exhibitors flock to for the scripted lines. However, don’t get turned off by the forum. You can get a lot out of the show if you have the right plan.
You need to do a little homework prior to getting on the plane. Look at the website or show guide to set your top 5 things you want to accomplish. This list can include things on the show floor, classes or seminars, networking dinners/drinks/lunches or a combination of the above. Many times, people come to shows with no plan and get caught up in things that are time wasters. How many times have you found that on the last day of the show you are frustrated by how busy you were but feel like you didn’t get done what you want?
However, don’t get too programmed. Don’t be one of those people who follows their checklist and plow through 3 days with every minute planned. You will see new things and meet new people. Leave time to explore and wander. Leave time to arrange an impromptu meeting or meal with a new prospect or vendor. Keep an open mind.
Finally, have fun. It is a good time to get away from the daily grind and blow off some steam. But remember, this is Vegas, so pace yourself; don’t end up like this guy …
See you on the Strip.
Wednesday, August 13, 2008
Busy, Busy, Busy
It is that time of year again—the summer season of short lead times. For most of North America, the hot weather turns up the temperatures and the tempers. How do you deal with it?
Every business faces cycles of busy and slow times. However, the construction business can bring those swings to extreme highs and lows. Everyone in the business is challenged with balancing the ability to serve customers with the costs of doing business. Those who succeed in the long run are willing to look at new ways to squeeze the rat through the snake.
We are in the middle of the first summer of our tenure at FabTech. We are very busy with both current work and backlog. Our customers all want product faster and faster. I noticed that Wausau featured a new program offering shorter lead times. Their announcement specifically called out the shortening build cycle. While Wausau specifically calls out their strategy, all of us are trying to squeeze timelines while still putting out quality work.
So, what can you do? Bottom line, the time to attack the busy season is during the slower times. If you talk to your people and customers about pain points ahead of time, you will have time to implement some solutions in small steps (think lean manufacturing or Kaizen).
OK we are all too busy to spend any more time now. GET BACK TO WORK – YOUR CUSTOMERS ARE WAITING!
PS – With the Olympics in the news, I have seen some of the chatter on the blog boards about China. I traveled to China last year on business. It is a fascinating place. It is a land of contrasts. I saw very modern factories with huge investments in automation and technology. Really world-class stuff. Then, across the street is an ox cart or even corn drying in the middle of a 4-lane highway.
I saw raw sewage in the gutters of Guangzhou. This is a city of 9 million plus. Massive advances and wealth alongside ancient sites and immense poverty. Contrast, contrast, contrast.
My take is that the central government of China is still very controlling and doesn’t care about the health and safety of workers. Also, the wealth being created by the West’s appetite for cheap goods is not being used to improve infrastructure beyond the large cities.
That being said, they will host a hell of an Olympic games. When "the man” controls everything, the big things will run smoothly. Just don’t look behind the scenes—the backstage is very messy.
Every business faces cycles of busy and slow times. However, the construction business can bring those swings to extreme highs and lows. Everyone in the business is challenged with balancing the ability to serve customers with the costs of doing business. Those who succeed in the long run are willing to look at new ways to squeeze the rat through the snake.
We are in the middle of the first summer of our tenure at FabTech. We are very busy with both current work and backlog. Our customers all want product faster and faster. I noticed that Wausau featured a new program offering shorter lead times. Their announcement specifically called out the shortening build cycle. While Wausau specifically calls out their strategy, all of us are trying to squeeze timelines while still putting out quality work.
So, what can you do? Bottom line, the time to attack the busy season is during the slower times. If you talk to your people and customers about pain points ahead of time, you will have time to implement some solutions in small steps (think lean manufacturing or Kaizen).
OK we are all too busy to spend any more time now. GET BACK TO WORK – YOUR CUSTOMERS ARE WAITING!
PS – With the Olympics in the news, I have seen some of the chatter on the blog boards about China. I traveled to China last year on business. It is a fascinating place. It is a land of contrasts. I saw very modern factories with huge investments in automation and technology. Really world-class stuff. Then, across the street is an ox cart or even corn drying in the middle of a 4-lane highway.
I saw raw sewage in the gutters of Guangzhou. This is a city of 9 million plus. Massive advances and wealth alongside ancient sites and immense poverty. Contrast, contrast, contrast.
My take is that the central government of China is still very controlling and doesn’t care about the health and safety of workers. Also, the wealth being created by the West’s appetite for cheap goods is not being used to improve infrastructure beyond the large cities.
That being said, they will host a hell of an Olympic games. When "the man” controls everything, the big things will run smoothly. Just don’t look behind the scenes—the backstage is very messy.
Wednesday, June 25, 2008
Time to Reflect
As Charles Dickens said, “Reflect upon your present blessings, of which every man has plenty; not on your past misfortunes of which all men have some.”
Or maybe Freddie Mercury of Queen said it better …
“Is this the real life? Is this just fantasy?
Caught in a landslide, No escape from reality.
Open your eyes, Look up to the skies and see,
I'm just a poor boy, I need no sympathy,
Because I'm easy come, easy go, Little high, little low,
Any way the wind blows doesn't really matter to me, to me…”
Whether it comes from Merry Old England or the rock and roll of my youth, I have a lot going through my head these days. As I get ready for a little vacation, it is time for me to look back over the last year and take a breath.
A little less than a year ago, I was getting back from the beach and looking for a business to buy. Then, along came the poker game. That started the adventure that is FabTech.
I have learned a lot about the business, the people here, the culture, the products and myself. I know some of you are now groaning about another top 10 list, but here it goes.
The top 7 things I have learned in my first 7 months at FabTech:
7. Customer interaction is the most important thing you can do with your time. Customers are not a “hassle” and they don’t “interrupt your day.” They are the ones who pay the bills.
6. Financial statements can be fun. Well, maybe not fun, but getting a real handle on how your business is doing can be very clear when you look at the numbers. The exercise of looking at the numbers weekly and monthly gives me a chance to be sure we are doing the right things.
5. Take time for yourself and your family. It is very easy as a business owner to get wrapped up in the issues 24x7. I am still learning how to balance the work and family time. This is not just about the time spent in the office and on the phone, but the mental break away from thinking about it. It is tough but necessary.
4. Cleveland sports teams make me crazy. Ok, not about the entrepreneur, but I am sick and tired of my favorite teams watching others have parades. The Tribe and Cavs both showed promise going into their seasons, but both disappointed. Maybe it is the year of the Browns??? Only my days living near Wrigley Field make me feel that someone knows our pain.
3. The commercial glazing market is all about managing chaos. No project seems to go as planned. Speed and flexibility is the key for everyone throughout the channel—from the architect to the glazing contractor. Sometimes the projects can feel like a big game.
2. We live in the greatest nation in the world. Whether McCain or Obama win, consider yourself blessed. It just takes a quick look at the situation in Zimbabwe to see how bad it can be for others. My father lives outside the United States and recently told me that he has grown in his appreciation for the USA from afar. In fact, he is now looking to move back to the U.S. Sometimes the grass is not greener.
Although sometimes you just have to laugh at what other voters do.
1. Customer is king. Right or wrong, the customer is always right. Whatever you do for a living, this is always number one.
Enjoy the summer and thanks for reading. Now, where did I put my flip flops?
Or maybe Freddie Mercury of Queen said it better …
“Is this the real life? Is this just fantasy?
Caught in a landslide, No escape from reality.
Open your eyes, Look up to the skies and see,
I'm just a poor boy, I need no sympathy,
Because I'm easy come, easy go, Little high, little low,
Any way the wind blows doesn't really matter to me, to me…”
Whether it comes from Merry Old England or the rock and roll of my youth, I have a lot going through my head these days. As I get ready for a little vacation, it is time for me to look back over the last year and take a breath.
A little less than a year ago, I was getting back from the beach and looking for a business to buy. Then, along came the poker game. That started the adventure that is FabTech.
I have learned a lot about the business, the people here, the culture, the products and myself. I know some of you are now groaning about another top 10 list, but here it goes.
The top 7 things I have learned in my first 7 months at FabTech:
7. Customer interaction is the most important thing you can do with your time. Customers are not a “hassle” and they don’t “interrupt your day.” They are the ones who pay the bills.
6. Financial statements can be fun. Well, maybe not fun, but getting a real handle on how your business is doing can be very clear when you look at the numbers. The exercise of looking at the numbers weekly and monthly gives me a chance to be sure we are doing the right things.
5. Take time for yourself and your family. It is very easy as a business owner to get wrapped up in the issues 24x7. I am still learning how to balance the work and family time. This is not just about the time spent in the office and on the phone, but the mental break away from thinking about it. It is tough but necessary.
4. Cleveland sports teams make me crazy. Ok, not about the entrepreneur, but I am sick and tired of my favorite teams watching others have parades. The Tribe and Cavs both showed promise going into their seasons, but both disappointed. Maybe it is the year of the Browns??? Only my days living near Wrigley Field make me feel that someone knows our pain.
3. The commercial glazing market is all about managing chaos. No project seems to go as planned. Speed and flexibility is the key for everyone throughout the channel—from the architect to the glazing contractor. Sometimes the projects can feel like a big game.
2. We live in the greatest nation in the world. Whether McCain or Obama win, consider yourself blessed. It just takes a quick look at the situation in Zimbabwe to see how bad it can be for others. My father lives outside the United States and recently told me that he has grown in his appreciation for the USA from afar. In fact, he is now looking to move back to the U.S. Sometimes the grass is not greener.
Although sometimes you just have to laugh at what other voters do.
1. Customer is king. Right or wrong, the customer is always right. Whatever you do for a living, this is always number one.
Enjoy the summer and thanks for reading. Now, where did I put my flip flops?
Wednesday, May 28, 2008
Culture 101
The heartbeat of any organization is the mythical culture. It is stronger than the rumor mill. It is what new associates feel most when they come on board. It is critical.
Then why do most managers and owners ignore it?
I have been guilty of ignoring culture on various occasions in the past. Sometimes it doesn’t matter in the short run. Sales targets can continue to be met. Customers can be serviced and products can be put out on time and with good quality. But, beware. Culture, specifically corporate/company culture, WILL impact every organization. It may take a while, but it will not be ignored.
As we started to get a rhythm at FabTech, I found myself detecting the underlying culture. It was not said out loud. It was not put up on signs or posters. It was not talked about at the lunchroom table. But make no mistake, it was there.
I would summarize FabTech’s culture as very customer focused, but scattered. In other words, the overall goal of doing right by customers was very evident, but not intentional.
Sixty days after our ownership change I made a very conscious choice to define and actively manage the culture at FabTech. We would make a choice to develop our culture and grow as individuals. To start with, we would present a theme of the month at each meeting. Themes such as Character, Intention, Teamwork, Honesty, Respect, Love and Trust would be part of every day.
Yes, you read it right. We talk about respect, trust and love. Now, you can imagine the looks on the faces of our associates. They thought this was more executive BS. They were resistant. However, they saw the possibilities. They saw owners who were willing to share profits and financial data in open meetings. Privately, they talked to each other that it just might work.
Sure, the fact that we instituted profit sharing and pay quarterly checks makes everyone more willing. But, isn’t that the point of profit sharing—to make everyone think like an owner and welcome change? Like Bambi on the ice, our cultural momentum can stumble. However, now FabTech has a defined and intentional path to improve customer service, product quality and profits. Most importantly, it is not by management decree, but by consensus.
Then why do most managers and owners ignore it?
I have been guilty of ignoring culture on various occasions in the past. Sometimes it doesn’t matter in the short run. Sales targets can continue to be met. Customers can be serviced and products can be put out on time and with good quality. But, beware. Culture, specifically corporate/company culture, WILL impact every organization. It may take a while, but it will not be ignored.
As we started to get a rhythm at FabTech, I found myself detecting the underlying culture. It was not said out loud. It was not put up on signs or posters. It was not talked about at the lunchroom table. But make no mistake, it was there.
I would summarize FabTech’s culture as very customer focused, but scattered. In other words, the overall goal of doing right by customers was very evident, but not intentional.
Sixty days after our ownership change I made a very conscious choice to define and actively manage the culture at FabTech. We would make a choice to develop our culture and grow as individuals. To start with, we would present a theme of the month at each meeting. Themes such as Character, Intention, Teamwork, Honesty, Respect, Love and Trust would be part of every day.
Yes, you read it right. We talk about respect, trust and love. Now, you can imagine the looks on the faces of our associates. They thought this was more executive BS. They were resistant. However, they saw the possibilities. They saw owners who were willing to share profits and financial data in open meetings. Privately, they talked to each other that it just might work.
Sure, the fact that we instituted profit sharing and pay quarterly checks makes everyone more willing. But, isn’t that the point of profit sharing—to make everyone think like an owner and welcome change? Like Bambi on the ice, our cultural momentum can stumble. However, now FabTech has a defined and intentional path to improve customer service, product quality and profits. Most importantly, it is not by management decree, but by consensus.
Tuesday, April 29, 2008
Day One
So we all breathed a long sigh of relief. The deal had closed. The due diligence process had not been too bad. We had a great seller in Rick who had poured his heart and soul into the business.
Then came Day One. We had a meeting on Monday morning where Rick announced the deal and introduced the new owners. I felt like the new kid in school moving into town. Rick had done a good job of keeping his intention to sell quiet.
The announcement meeting went pretty well. Rick said his piece and I introduced myself and the other owners. We each had experience with these types of announcements in different contexts (mergers, acquisitions, plant shutdowns, etc). The stress on the face of the plant floor associates is always the same. The first thing anyone worries about is their job: “Will I have one?” “Do the new guys know what they are doing?”
One thing that helped with establishing our culture of open communication is that we handed out a FAQ document that told everyone that no job cuts were planned, there were no changes to pay rates, healthcare, 401(k) etc. Bottom line, it was a strong business that had an owner that wanted to move onto other things and a new ownership group that knew that the associates of the business were the only assets that really mattered.
If you ever have a situation like Adobe’s (see example by Adobe) that will result in job cuts, I highly encourage you to be up front with the FAQ and tell everyone how and when it will be done. You will never get over the loss of credibility if you get up on Day One and tell everyone “everyone’s job is safe” then lay people off. Don’t do it despite how tempting it might be.
I spent the first day getting to know the guys in a very casual way and answering all kinds of questions one-on-one. An end of the day follow-up meeting showed the deeply rooted feelings that people at FabTech had for the business, the quality of work and the strong relationships with our customers. The strong vibe was that the associates didn’t want us to “screw it up.”
I was very conscious of listening extra hard on Day One. I wanted the associates to know that we valued their contribution to the past success of FabTech and needed their expertise and enthusiasm to reach our goals for the new FabTech.
Next week, the outline for our new culture.
On the lighter side, as I watched the NFL draft last weekend, I couldn’t help but think about how much these kids are making and how much training they do to impress scouts. My favorite coach has made a draft training video, check it out here.
Then came Day One. We had a meeting on Monday morning where Rick announced the deal and introduced the new owners. I felt like the new kid in school moving into town. Rick had done a good job of keeping his intention to sell quiet.
The announcement meeting went pretty well. Rick said his piece and I introduced myself and the other owners. We each had experience with these types of announcements in different contexts (mergers, acquisitions, plant shutdowns, etc). The stress on the face of the plant floor associates is always the same. The first thing anyone worries about is their job: “Will I have one?” “Do the new guys know what they are doing?”
One thing that helped with establishing our culture of open communication is that we handed out a FAQ document that told everyone that no job cuts were planned, there were no changes to pay rates, healthcare, 401(k) etc. Bottom line, it was a strong business that had an owner that wanted to move onto other things and a new ownership group that knew that the associates of the business were the only assets that really mattered.
If you ever have a situation like Adobe’s (see example by Adobe) that will result in job cuts, I highly encourage you to be up front with the FAQ and tell everyone how and when it will be done. You will never get over the loss of credibility if you get up on Day One and tell everyone “everyone’s job is safe” then lay people off. Don’t do it despite how tempting it might be.
I spent the first day getting to know the guys in a very casual way and answering all kinds of questions one-on-one. An end of the day follow-up meeting showed the deeply rooted feelings that people at FabTech had for the business, the quality of work and the strong relationships with our customers. The strong vibe was that the associates didn’t want us to “screw it up.”
I was very conscious of listening extra hard on Day One. I wanted the associates to know that we valued their contribution to the past success of FabTech and needed their expertise and enthusiasm to reach our goals for the new FabTech.
Next week, the outline for our new culture.
On the lighter side, as I watched the NFL draft last weekend, I couldn’t help but think about how much these kids are making and how much training they do to impress scouts. My favorite coach has made a draft training video, check it out here.
Wednesday, April 9, 2008
The Deal
So, I went to a poker fundraiser tournament. While there, I met a friend of a friend. It turned out that he ran an interior contracting business and had done the finish work on the office of GED. Mike Ritenour, owner of Lou Ritenour Decorators and Landmark Stone, sat at my table and we chatted a little about commercial construction and the trends in green building for interiors and exteriors. No, I didn’t win the tournament, but did make the final table and had a good time.
About two months later, I got an email from Mike and his partners wanting to discuss a business they were looking to purchase. Mike Ritenour had partnered with Mike Orazen, former owner of EPG gaskets and Mike Boehringer, owner of several businesses in the document management and software industries. The three “Mikes” has pooled together some capital to form a boutique private equity fund specifically focused on the building products industry.
The e-mail mentioned a value-added fabricator of architectural door, storefront and curtainwall systems. Long story short, we hooked up and partnered to purchase FabTech in November 2007.
FabTech Inc. was founded 13 years ago by Rick Herrilko and a team of his fellow fabricators from the old PPG/Pittco operation in Cleveland. Rick had built an excellent customer-focused company that thrived on quality, speed and flexibility.
We had found a gem of a company in a market that was strong and growing stronger. We did our financial, legal, environmental and cultural due diligence.
So, I quit my job and became part owner and president of FabTech LLC. I am blessed with a great team of partners. Each of the “Mikes” brings a wealth of experience in management, business ownership, mergers and acquisitions, and product development. We each have our strengths and weaknesses and complement each other with support and challenge each other to be better every day.
We inherited a strong team of nine fabricators and an excellent estimator. Rick has stayed on as a consultant. There is a cumulative 150+ years experience in fabrication and customer service. We had an excellent team and a very strongly embedded culture. However, while the customer came first, we had some improvements to make in the culture and teamwork at FabTech. We did not get into a cultural mess, but wanted to redefine the approach to business and expectations of success and long term growth.
Next week stay tuned for the challenges of getting to know the business on paper versus what happens post closing in the real world. Also, how youth sports coaching and mentoring can help your business.
About two months later, I got an email from Mike and his partners wanting to discuss a business they were looking to purchase. Mike Ritenour had partnered with Mike Orazen, former owner of EPG gaskets and Mike Boehringer, owner of several businesses in the document management and software industries. The three “Mikes” has pooled together some capital to form a boutique private equity fund specifically focused on the building products industry.
The e-mail mentioned a value-added fabricator of architectural door, storefront and curtainwall systems. Long story short, we hooked up and partnered to purchase FabTech in November 2007.
FabTech Inc. was founded 13 years ago by Rick Herrilko and a team of his fellow fabricators from the old PPG/Pittco operation in Cleveland. Rick had built an excellent customer-focused company that thrived on quality, speed and flexibility.
We had found a gem of a company in a market that was strong and growing stronger. We did our financial, legal, environmental and cultural due diligence.
So, I quit my job and became part owner and president of FabTech LLC. I am blessed with a great team of partners. Each of the “Mikes” brings a wealth of experience in management, business ownership, mergers and acquisitions, and product development. We each have our strengths and weaknesses and complement each other with support and challenge each other to be better every day.
We inherited a strong team of nine fabricators and an excellent estimator. Rick has stayed on as a consultant. There is a cumulative 150+ years experience in fabrication and customer service. We had an excellent team and a very strongly embedded culture. However, while the customer came first, we had some improvements to make in the culture and teamwork at FabTech. We did not get into a cultural mess, but wanted to redefine the approach to business and expectations of success and long term growth.
Next week stay tuned for the challenges of getting to know the business on paper versus what happens post closing in the real world. Also, how youth sports coaching and mentoring can help your business.
Friday, March 21, 2008
The Hunt
So, I decided to take the plunge to look for a business to purchase. I was looking for an existing business that had a strong core of customer service and product/service quality. With some background in lean manufacturing and product development, I thought I could add value to a business that was on "auto pilot."
I looked at a lot of sketchy businesses. Just like buying a house, you have to balance the asking price of a business with the value and future prospects. Instead of concentrating on the quality of local schools, neighborhood safety, and the kitchen, I spent a lot of time looking at product line depth, workforce, competition, and that intangible "gut feel."
Dealing with business brokers was an educational experience. I found out that, like most things in life, there are good ones and bad. The bad ones will tout a "piece of crap" as the best thing since Dean Kamen and the personal transporter that would save the world. The good ones end up matching qualified buyers with quality companies priced at reasonable levels.
After looking at over 15 companies, I hadn't found the right one. Then, I went to play poker and everything changed. Stay tuned for what happened next...
After my first post, I got a call from Paul Bieber. He is another blogger for USGlass. He shared many good insights with me about blogging, the industry and how the two can mix with family and personal observations.
So, on a personal note, I am very luck to a fantastic wife. Jean and I have been married for almost 18 years. Jean has always trusted me in my career moves and risks. She rides the highs and lows with me. I have never been one of those macho guys who feel like they have to be the king of the house. Jean is definitly the boss of the house. We have four great kids - Matthew 14, David 12, Katie 9, and Michael 6. She manages our "happy chaos".
Thanks Paul for encouraging me to share a little about myself and my family.
I looked at a lot of sketchy businesses. Just like buying a house, you have to balance the asking price of a business with the value and future prospects. Instead of concentrating on the quality of local schools, neighborhood safety, and the kitchen, I spent a lot of time looking at product line depth, workforce, competition, and that intangible "gut feel."
Dealing with business brokers was an educational experience. I found out that, like most things in life, there are good ones and bad. The bad ones will tout a "piece of crap" as the best thing since Dean Kamen and the personal transporter that would save the world. The good ones end up matching qualified buyers with quality companies priced at reasonable levels.
After looking at over 15 companies, I hadn't found the right one. Then, I went to play poker and everything changed. Stay tuned for what happened next...
After my first post, I got a call from Paul Bieber. He is another blogger for USGlass. He shared many good insights with me about blogging, the industry and how the two can mix with family and personal observations.
So, on a personal note, I am very luck to a fantastic wife. Jean and I have been married for almost 18 years. Jean has always trusted me in my career moves and risks. She rides the highs and lows with me. I have never been one of those macho guys who feel like they have to be the king of the house. Jean is definitly the boss of the house. We have four great kids - Matthew 14, David 12, Katie 9, and Michael 6. She manages our "happy chaos".
Thanks Paul for encouraging me to share a little about myself and my family.
Wednesday, March 19, 2008
Now What? A Residential Guy Goes Commercial
Hi there. I’m the new guy to the USGlass blog lineup. So, what makes me worthy of reading? Well, here is the “back story” on why I’m posting.
Over the last eight years, I was with GED Integrated Solutions (formerly Glass Equipment Development). They manufacture machinery for the door and window business. As the head of marketing and information technology, I learned a lot about the construction business and what customers wanted and needed. I enjoyed my time at GED and in the residential world. I met a lot of great folks and think we did some good things. I am sure many of you have their equipment.
So, why did I leave? Like many of you, I did pretty well working for a series of companies in several industries. I have been able to support my family and have some fun along the way, but (here comes the “BIG BUT”) I have always wanted to run my own business. I had many of the known American entrepreneurial traits – desire to build something, impatience with corporate cultures and customer-driven thoughts.
For a long time, I had tried to think of the “next big thing” that would propel me into a start up venture. I thought the path for me was to become the next Bill Gates, Thomas Edison or at least Richard James or Stan Honey.
About a year ago, finally came to the realization that I was not an inventor, but better suited to growing an existing business with new products, new markets and improved operations. So, I started to hunt for a business where I could use my background and door and window experience.
CLICK HERE to share your stories about becoming an entrepreneur or post your comments below.
Over the last eight years, I was with GED Integrated Solutions (formerly Glass Equipment Development). They manufacture machinery for the door and window business. As the head of marketing and information technology, I learned a lot about the construction business and what customers wanted and needed. I enjoyed my time at GED and in the residential world. I met a lot of great folks and think we did some good things. I am sure many of you have their equipment.
So, why did I leave? Like many of you, I did pretty well working for a series of companies in several industries. I have been able to support my family and have some fun along the way, but (here comes the “BIG BUT”) I have always wanted to run my own business. I had many of the known American entrepreneurial traits – desire to build something, impatience with corporate cultures and customer-driven thoughts.
For a long time, I had tried to think of the “next big thing” that would propel me into a start up venture. I thought the path for me was to become the next Bill Gates, Thomas Edison or at least Richard James or Stan Honey.
About a year ago, finally came to the realization that I was not an inventor, but better suited to growing an existing business with new products, new markets and improved operations. So, I started to hunt for a business where I could use my background and door and window experience.
CLICK HERE to share your stories about becoming an entrepreneur or post your comments below.
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