Enterprise Minnesota Magazine - Fall 2019

Ridgewater College used a manufacturing IMAGINATIVE BLUEPRINT How consultant to plot its strategic outlook

Helping Manufacturing Enterprises Grow Profitably FALL 2019

Not Your Grandpa’s Foundry How Dotson Iron Castings has used automation and innovation to become a new-age foundry

This is Dotson

Enterprise Minnesota 2100 Summer St. NE, Suite 150 Minneapolis, MN 55413

Enterprise Minnesota FY 2019-2020 Manufacturing Workshops and Business Events

Enterprise Minnesota’s events offer outstanding professional expertise and practical business solutions to improve competitiveness and growth opportunities for Minnesota’s manufacturers and related industries.

DATE

TOPIC

CITY

Sept. 24

Strategy

St. Cloud

Oct. 8

Continuous Improvement

Fergus Falls

Oct. 30

Executive Manufacturing Forum

Rochester

Nov. 7

Continuous Improvement

Anoka

Nov. 19

Leadership

Woodbury

Dec. 5

Continuous Improvement

Prior Lake

Dec. 17

Strategy

Plymouth

January 14

Revenue Growth

Roseville

January 30

Continuous Improvement

Litchfield

Feb. 11

Executive Manufacturing Forum

Maple Grove

Feb. 27

Continuous Improvement

Cambridge

March 10

Revenue Growth

Mankato

March 19

Leadership

Edina

April 7

Leadership

Hutchinson

April 23

Revenue Growth

Owatonna

May 7

Leadership

Willmar

FALL 2019

22

TESTED BY FIRE

How Dotson has used automation and innovation to become a new-age foundry

28

32

36

Manufacturing’s Grand Enabler

The Process of Planning

Castles in the Sky

How Ridgewater College used a manufacturing consultant to plot its strategic path ahead

By restoring and building vintage WWII aircraft, Bemidji’s AirCorps has built a prosperous niche company with local talent

How MEP’s state Centers offer affordable, cutting edge consulting to manufacturers

3

2 Employee Recognition Employers will ultimately realize the contributions of their workers when they’re gone

‘Not Bad for a Bunch of Farm Boys’ Kern brothers combine two related laser-tech companies with growing international markets

12 Preparing for Technology New DEED program helps small manufacturers get their employees trained for high tech demands

40 In Search of ‘Aha’ Moments A new program will help show manufacturers the simple value of strategy

Visit the Enterprise Minnesota website for more details on what’s covered in the magazine at enterpriseminnesota.org.

Subscribe to The Weekly Report and Enterprise Minnesota® magazine today! Get updates on the people, companies, and trends that drive Minnesota’s manufacturing community. To subscribe, please visit enterpriseminnesota.org/subscribe.

FALL 2019 ENTERPRISE MINNESOTA /

1

Helping Manufacturing Enterprises Grow Profitably

Employee Recognition

Publisher Lynn K. Shelton 9001:2015

Employers will ultimately realize the contributions of their workers when they’re gone

A

s Enterprise Minnesota recently celebrated our annual “Esteemed Colleague” event, I was reminded of the Norwegian-Minnesotan who loved his wife so passionately that he almost told her.

It is not good enough for managers to truly appreciate the contributions of their employees and almost tell them.

Employee recognition, especially through special events, should comprise any manufacturer’s overall HR strategy. Face it: a typical company performs no better than the quality contributions of its employees.

The company that takes for granted its productive, creative, and collaborative workers simply doesn’t function optimally. And, worse, today’s employee-starved marketplace will ensure self-involved management teams will eventually appreciate the efforts of those workers when they’re gone.

Today’s HR market demands that employee recognition goes far beyond the traditional pat-on-the-head acknowledgments of yesteryear. Employee recognition has significantly evolved from the days when some chunky banker with a handlebar mustache in a three-piece pinstripe suit would commemorate an employee’s lifetime of service through a ceremonial gold watch. Tenure has merit, to be sure, but recognition should thoughtfully honor employee contributions.

To me, the most effective—and authentic—employee recognition model develops from a peer-to-peer process.

That way, the award becomes less about which apple-polishing employee is most skilled at managing up. It focuses instead 2

/ ENTERPRISE MINNESOTA FALL 2019

on colleagues’ perceptions about employees who work best with each other and whose quiet contributions may have improved productivity or overall morale.

The empowerment of a peer-to-peer nomination process also fosters an overall sense of team-building. Nominating a coworker enables the entire workforce to appreciate that their opinions matter, that the “winners” reflect the skillsets and attitudes they respect. Peer opinions, therefore, become part of something bigger than being merely expendable tools.

Employees who feel well-appreciated will be more likely to stay with their team.

Candidly, the peer-to-peer model of recognition benefits managers as well.

Employees who elevate the performance of a worker may give insights to managers about hidden talents or effectiveness that has slipped under their radar.

It also contributes to employee development. Employees will look at the “winners” for ways to model the kinds of attitude, behavior, and performance that are appreciated by their colleagues.

Smart managers will place these awards in the context of the purposeful, goaloriented attitudes they want to see in their employees. By focusing on how these employees bring value to the shop floor or the office, managers can showcase how these behaviors fit into the overall mission of the company.

Bob Kill is president and CEO of Enterprise Minnesota.

Custom Publishing By

Creative Director Scott Buchschacher Copy Editor Catrin Wigfall Writers Sue Bruns R.C. Drews John Manke Robb Murray Maria Surma Manka Catrin Wigfall Photographers Pat Christman Jeremy Petrick Paula Primeau Contacts To subscribe subscribe@enterpriseminnesota.org To change an address or renew ldapra@enterpriseminnesota.org For back issues ldapra@enterpriseminnesota.org For permission to copy lynn.shelton@enterpriseminnesota.org 612-455-4215 To make event reservations events@enterpriseminnesota.org 612-455-4239 For additional magazines and reprints ldapra@enterpriseminnesota.org 612-455-4202 To advertise or sponsor an event chip.tangen@enterpriseminnesota.org 612-455-4225 Enterprise Minnesota, Inc. 2100 Summer St. NE, Suite 150 Minneapolis, MN 55413 612-373-2900 ©2019 Enterprise Minnesota ISSN#1060-8281.

All rights reserved. Reproduction encouraged after obtaining permission from Enterprise Minnesota magazine.

Enterprise Minnesota magazine is published by Enterprise Minnesota 2100 Summer St. NE, Suite 150, Minneapolis, MN 55413 POSTMASTER: Send address changes to Enterprise Minnesota 2100 Summer St. NE, Suite 150 Minneapolis, MN 55413

Printed with soy ink on recycled paper, at least 10 percent post-consumer waste fiber.

FOCUS

‘Not Bad for a Bunch of Farm Boys’

PHOTOGRAPHS BY JEREMY PETRICK

Kern brothers combine two related laser-tech companies with growing international markets

F

rom their headquarters in rural Wadena, Kern Laser Systems and Kern Technologies are family businesses that have partnered with national players as large as Lockheed Martin, Boeing, NASA, and the U.S. military. They even have an international presence in Australia, the United Arab Emirates, and Japan.

“We have a machine in every continent besides Antarctica,” Derek Kern, president and CEO of Kern Laser Systems, says.

Not bad for a “bunch of farm boys,” says Derek’s brother, Aaron Kern, president and

CEO of Kern Technologies.

Today, the pair of cutting-edge, laser tech companies have a combined revenue of $15 million and sell to manufacturers of high-end consumer electronics, electronic signage, and aviation equipment. Such an outcome may have seemed unlikely in 1982. A father of four and respected professor of electronics and telecommunications at Wadena Vocational Technical College, Gerald Kern was an entrepreneur possessed by an endless curiosity for tinkering and invention. His company began in the family

garage. Through experimentation, Gerald developed a motorized X/Y gantry system and imagined agricultural applications, among others, for his new product.

But with plenty on his plate already, it took no small amount of grit to keep moving forward.

“On his lunch break, he would run to the shop, do sales calls, check on the guys— all while trying to raise a family,” Derek remembers. “When he built the company up to a certain degree, he quit teaching and invested all his time in the business.”

FALL 2019 ENTERPRISE MINNESOTA /

3

Lightning struck, however, following Gerald’s introduction to the late Peter Laakmann—a pioneer of CO2 laser technology.

Pairing one of Laakmann’s Synrad-branded lasers to a Kern motorized gantry, Gerald had stumbled onto an idea with potential.

Though still an early prototype, the product would be refined and eventually capable of computerized cutting and engraving, much like the products the company now sells nearly 40 years later.

The epiphany marked the birth of Kern Laser Systems.

In 2019, the Kern brand exists as both Kern Laser Systems and Kern Technologies, run by two of Gerald’s sons. For brothers Derek and Aaron Kern, involvement in the family business came at a young age. The pair remember clearly their father’s home-based laser experiments and the warning light on the family garage during working hours that told them the space was off-limits.

“The nice part about our company is we stay busy enough where we don’t really have time to bicker,” Derek Kern says with a smile.

After graduating from high school some years apart, each brother moved away for college—Derek to Fargo’s North Dakota State University, and Aaron to the University of Minnesota, Minneapolis. Today, both admit they anticipated returning home post-college to family and friends, but the “why” and “when” couldn’t have been predicted.

“I don’t know if I always knew that I would be back with the company the Monday after I graduated,” Derek explains. “I always thought I’d go somewhere for a year or two first, but it just never happened.”

Armed with a degree in management information systems, Derek found himself taking over Kern Laser Systems’ website.

His involvement ramped up quickly. As Gerald sought to transfer leadership of the business, Derek proved himself to his father by taking on the weight. Around 2010, he was named president and CEO. “I think the biggest challenge was just the stage we were at, as far as growth. We were growing really fast, and my dad—he 4

/ ENTERPRISE MINNESOTA FALL 2019

was more of an inventor—didn’t want to grow the company; it wasn’t something that really appealed to him,” Derek says.

“My first months at the helm, going to trade shows, setting up distributors internationally, was all brand new to me.”

Aaron returned in 2014, just one year after a second company, Kern Technologies, was formed to handle the R&D behind the in-house laser systems Gerald began designing in 2005. Fresh out of college himself, Aaron describes the whirlwind process of taking over that young company as a considerable test of his aptitude, as well as a lesson in humility. It’s a task, he says, which could never have been accomplished without the aid of experienced, veteran employees at both companies who were gifted with the patience to teach and the willingness to work together as a team.

“If I had any questions, I could talk to Derek or other managers,” Aaron remembers. “It was just me over there for a lot of the different departments, but I still had people with experience that helped guide me along too.”

Too Busy to Bicker

When questioned about adversity faced over the last 11 years, Derek says that perhaps the greatest challenge was working alongside family. While their father continued to oversee research and development,

Today, the pair of cutting-edge, laser tech companies have a combined revenue of $15 million and sell to manufacturers of high-end consumer electronics, electronic signage, and aviation equipment.

their mother, Ivy, served as the company’s accountant; her eye for thrift partly helped the company survive the last recession.

Not all of Kern’s competitors were so fortunate.

Meanwhile, their sister manages accounts payable, and two of Derek’s brothers-in-law work within the businesses.

In the wrong family, it could be a recipe for disaster.

“There’s definitely a challenge there.

The nice part about our company is we stay busy enough where we don’t really have time to bicker,” Derek says with a smile.

Growth, too, has proven an obstacle to surmount. While Gerald has from the beginning focused on R&D, Derek says it was apparent after the recession that their company needed to grow to thrive.

With only limited training to prepare him, the young CEO jumped head-first into expanded marketing and international distribution.

Trade shows, though costly to attend, became a secret weapon for the Kern businesses. Derek says the return on that

investment has been well worth the cost.

Thanks in part to their father’s reputation for treating customers and coworkers with respect, Kern Laser Systems and Kern Technologies have become a staple and well-regarded feature of trade shows across the country. These include Photonics West, FABTECH, and the International Manufacturing Technology Show, among others.

“They definitely pay off,” Derek says.

Employee Culture

The companies so far haven’t struggled with the worker shortage that plagues many other manufacturers.

For one, the Kern companies are hightech businesses in a rural setting. This seeming paradox brings with it several advantages for employee retention— such as, the natural scenery and ready access to prime hunting and fishing without leaving home.

“What I often find is people want to work with technology, but they’d have to move to the Cities to do it. There are not a lot of chances for someone to stay here, enjoy all the outdoor activities that are around here, and still work for a technology company,” Derek says.

“And a lot of those people who have those hobbies, they’re really good candidates,” Aaron interjects.

Part of it may also come down to a reputation for fairness at all levels of business.

“We’ve always had a good reputation; our dad just took care of customers,” Derek says.

That same practice extends to employees. Today, despite the separate buildings and branding, Kern Laser Systems and Kern Technologies exist as one big family, with regular picnics and special events to recognize their hard-working staff for top-shelf work.

On maintaining a positive workforce culture, Derek says, “It’s everything. All it takes is one person. That’s why we do a lot of things with our employees.”

Both brothers say they work hard to monitor workplace morale—intervening as needed, while avoiding micro- and drive-by management styles. And to this pair of company presidents, business success is all about finding the right people and treating them well.

Just as important, Derek says, is remembering that the smartest employers hire people smarter than themselves.

At Kern, many of those smarter

people were former students and even fellow teachers of Gerald’s from his time as a professor. Curriculum at the local tech college has changed over the decades, however, and nearby Alexandria Technical College and its mechatronics program have helped fill what gap remains. Where skilled candidates are lacking, Aaron says the team has had regular success through word-of-mouth advertising, sourcing anyone with an interest in electrical and mechanical tinkering and then training them for the positions on offer.

Attributing their low turnover to competitive wages and strong morale, Derek and Aaron have seen a company culture emerge that inspires workers to invest their time and be compensated for it through regular opportunities for advancement.

“Treat your employees well, recognize them for their good work, and compensate them for that,” Aaron says.

Endless Possibilities

Having weathered the storm of last decade’s recession, both Kern Laser Systems and Kern Technologies have emerged stronger and more committed from the experience. Today, Derek views the future with unrestrained optimism.

“The thing about a laser is its endless possibilities. One day our salesmen are working with NASA, and the next day they’re working with a ‘ma and pa’ shop.

One day we’re selling to a monument company, and the next day we’re selling a FiberCELL to a Fortune 500 company that’s just cutting metal parts.”

With Kern Laser Systems using lasers designed and built by Kern Technologies exclusively in their product line— with the exception of their FiberCELL product—there is limitless potential that benefits both companies. But growth continues to bring new puzzles to solve, and in 2019, the focus is on Enterprise Resource Planning (ERP) software to advance efficiency before manufacturing capacity reaches its limits. For that reason, both companies will be rolling out new ERP software on January 1, 2020.

It’s a process which may take multiple phases and several years to complete, but both CEOs see it as the next step in growing the 40-plus employee businesses their father started from the family garage in 1982.

—R.C. Drews

Doing things differently to serve you better.

Marsh & McLennan Agency’s advisors know your industry and situation, and evolve with you as your needs change.

We can minimize potential exposures now for a better tomorrow.

That’s individualized attention delivered smarter.

MarshMMA.com

BUSINESS INSURANCE EMPLOYEE HEALTH & BENEFITS EXECUTIVE BENEFITS PRIVATE CLIENT SERVICES RETIREMENT SERVICES RISK MANAGEMENT SURETY

MINNEAPOLIS | DULUTH LOCATIONS THROUGHOUT THE UPPER MIDWEST +1 800 444 3033

FALL 2019 ENTERPRISE MINNESOTA /

5

NEXT GEN

Robotics Competitions Prepare the Future A Chaska-based machine shop partners with two high school robotics teams to fuel students’ passions for science and technology

T

he emerging technological breakthrough of robotics in the manufacturing industry has inspired a Minnesota precision manufacturing company to invest in the next generation of innovators: high school robotics teams.

Continental Engineering and Manufacturing (CEM), a Chaska-based machine shop, started partnering with high school level robotics programs eight years ago.

“We support robotics teams because we see value in fueling students’ passions for science and technology,” Eric Anderson, president of CEM, says. “It also gives us the opportunity to expose them to manufacturing.”

CEM is a company of 55 employees that specializes in drive shaft assemblies, components, custom machined parts, and weldments. It financially sponsors Eden Prairie High School’s “Talon Robotics” team and Frazee High School’s “Kaotic Robotics” team, both which have around 40 high school members who work together each

6

/ ENTERPRISE MINNESOTA FALL 2019

school year building robots that compete in international FIRST Robotics competitions. CEM donates machining time to help students build their robots, as well.

“The students are in charge of drawing out and designing the components of their robots, and then we offer a show-and-tell on which machines produce their parts,” Anderson says. “We also offer summer apprenticeships so students can get handson experience and learn what it takes to actually produce a robotic part they design. It gets them thinking about their next career steps.”

The company’s apprenticeship program consistently attracts robotics team members, and currently two former high school robotics team members work at CEM’s facility full time. Anderson was impressed with both the soft and hard skills the alumni brought to the company.

“Not only do robotics teams teach high schoolers STEM skills (science, technology, engineering, and math), but they also

The company’s apprenticeship program consistently attracts robotics team members, and currently two former high school robotics team members work at CEM’s facility full time. learn creativity and problem-solving,” Anderson says. “When their robot doesn’t perform as expected, they have to think outside of the box, communicate with each other, and come up with solutions.”

The Talon Robotics team is led by students and guided by mentors. Under the leadership of four student captains, two engineering and two business, team members participate in the computer aided design portion of building the robot and

“Supporting our local high school robotics teams so they can experience the excitement of a sport with the rigors of science and technology has great value,” Anderson says.

the business side that involves community outreach and fundraising. Adult mentors are available to guide students on further leadership, communication, and collaboration skills development.

With the help of adult volunteers and mentors, the Kaotic Robotics team is comprised of students interested in STEM but also programming, business, and marketing. These interests blend together well as team members both build their robots and raise funds through corporate sponsorship and other fundraising activities.

Because building and competing with a multifunctional, electronic robot is expensive (Talon Robotics has a budget of $50,000 to $55,000 a year!), the teams

rely on company sponsorships and fundraising to support their love of robotics.

Students on the teams oversee raising the money themselves, and they often put on demonstrations at various companies to attract sponsors. They show off their robot—and sometimes even let others try driving it—and share why robotics competitions are valuable for students and sponsors alike. Students gain skills essential in any successful company, skills of leadership, marketing, teamwork, and communication, and sponsors can promote their company to a wide audience of viewers at the competition events, both live and via webcam.

Each team’s budget accounts for materials and tools to construct their robots, but also pays for materials to build practice fields where the robots are tested. Additionally, the budget includes the cost of competition registration and transportation.

FIRST Robotics competitions attract high school robotics teams from all over the country and even overseas. Participants design and build industrial-size robots that weigh up to 125 pounds and compete in field games from scoring balls into goals to flying discs into goals and hanging inner tubes on racks to balancing on balance beams.

“Supporting our local high school robotics teams so they can experience the excitement of a sport with the rigors of science and technology has great value,” Anderson says. “I want to encourage other machining and fabricating companies to get involved with their local high school teams. It is well worth it.”

—Catrin Wigfall FALL 2019 ENTERPRISE MINNESOTA /

7

PROFILE

From Blacksmith to Metal Fabrication Haala Industries: 45 years of continuous growth

N

ow entering its 45th year in business, Haala Industries has reported continuous growth throughout its existence, transforming itself from a modest blacksmith shop into a regional manufacturing leader. Established in 1974, the company’s story begins with its founder David Haala in New Ulm. David’s repair and metal working skills quickly established him as an asset to this farming community. He turned these skills into a full-fledged business, purchasing a black-

smith shop in Sleepy Eye, where Haala Industries still resides.

While David Haala could count on steady work from local farmers, it was his relationship with his landlord that set his fledgling enterprise on its current course.

After moving to Sleepy Eye, David began renting a house from the owner of a local brickyard, and one day, his new landlord brought him some steel tie rods and asked if he could produce more. Mr. Haala could, and he turned this relationship

SHE SUPPORTED A GREAT PROJECT OUR REBATES MADE IT EASY Upgrading to energy-efficient furnace heating systems and advanced thermostats saves energy and lowers your monthly bills. Can’t find the perfect rebate? We’ve created custom rebates to match manufacturers’ needs.

MINNESOTAENERGYRESOURCES.COM

866-872-0052

8

/ ENTERPRISE MINNESOTA FALL 2019

into a brisk business. He expanded his customer base and continued producing and selling steel rebar constructs for the infrastructure industry, forming the core of the company’s current business.

With David at the helm, his son Scott serves as the general manager alongside a strong core of longtime employees.

Together they have fostered a company culture that values hard work, prioritizes deadlines, and produces quality products for its customers.

The company’s success largely hinges on its flexibility to meet customer needs.

From a large inventory of prefabricated rebar mats, wire cone cages and pipe ties, to other construction-related products, Haala Industries can ship throughout the upper Midwest on demand. Its innovative solutions to new problems and custom projects have also been crucial to the company’s success. Thanks to its core group of skilled employees and new technology and software, Haala Industries adapts to the changing needs of its customer base. One notable example of

this is the work the company did with Ducks Unlimited. Haala’s improvement of the “fish fingers” technology—used under bridges to allow only water and aquatic vegetation into wetlands— helped further Ducks Unlimited’s Living Lakes program, which protects the shallow waters of Minnesota and Iowa.

Now an outside force far beyond its roots, Haala Industries operates throughout the Upper Midwest, including the Dakotas and Wisconsin. But its expansion hasn’t kept the company immune from challenges facing other manufacturers in the region, such as recruiting a trained and skilled workforce.

In fact, its desire to expand further west has highlighted Haala’s manpower issue.

The company is currently looking to add on to its buildings and upgrade its equipment while also continuing to secure new contracts and new customers.

According to the State of Manufacturing® conducted by Enterprise Minnesota, workforce retention is an overwhelming concern for manufacturers around the state. The drop in vocational skills training in secondary schools statewide hasn’t helped, either.

But Haala Industries is not alone, and son Scott Haala has taken steps to alleviate the problem, including ongoing participation in a Mankatobased manager peer group facilitated

by Enterprise Minnesota. Here, a group of 12 manufacturing company managers meet and discuss different strategies they have employed to overcome impediments and warn about those that do not work.

Despite these challenges, Haala Industries has a bright future. The company is currently looking to add on to its buildings and upgrade its equipment while also continuing to secure new contracts and new customers. According to Scott, they are “always looking forward.” ­—John Manke

If you’re not optimizing, your compromising.

If you’ve got loads to move, we’ve got loads of creative ways to move them. With King, every solution is a fully customized one.

Ready for a custom solution? Let’s talk.

763.428.5464 // KINGSOLUTIONSGLOBAL.COM LOGISTICS AND FULFILLMENT // DAYTON, MN

FALL 2019 ENTERPRISE MINNESOTA /

9

EMPLOYEE RECOGNITION

The ‘Esteemed Colleague’ Workplace expert Michele Neale honored with Enterprise Minnesota’s top award

B

usiness Growth Consultant Michele Neale recently received Enterprise Minnesota’s “Esteemed Colleague” award.

The honor, the result of a peer-to-peer nomination process, is presented annually at Enterprise Minnesota’s rewards and recognition celebration. It goes to the employee who coworkers say best embodies the company’s cultural values and advances its mission to help Minnesota manufacturing enterprises grow profitably, according to Bob Kill, Enterprise Minnesota’s president and CEO. Neale has worked for Enterprise Minnesota for about a year. As a business growth consultant, she helps Minnesota-based manufacturers build stronger company cultures and develop effective leaders at all

10 / ENTERPRISE MINNESOTA FALL 2019

levels of their business. Kill said Neale has an exceptional track record of implementing talent and leadership strategies to help manufacturing companies engage and empower their employees to achieve operational excellence and drive profitable growth.

Before joining Enterprise Minnesota, Neale served as a human resources leader for Massman Automation Designs, LLC in Villard, and as a senior leader in training and development for Tastefully Simple in Alexandria. She earned a B.A. in speech communication from the University of MinnesotaMorris and an M.A. in communication from the University of North Dakota.

Neale became intrigued by Enterprise Minnesota while a member of the organiza-

tion’s HR Peer Council as an employee at Massman. She was recruited to Enterprise Minnesota by Abbey Hellickson, one of Minnesota’s top strategic HR experts.

“I love it,” Neale says. “It’s a great mix and an opportunity for me to meet and work with a lot of different organizations of different sizes and in different places of their journey. I love facilitation and consulting with organizations. It’s the first time that I’ve worked with them externally as opposed to internally.”

As a StrengthsFinder “Arranger,” Neale enjoys confronting complex situations by arranging contributing factors in ways that lead to optimal outcomes. “This seems to fit me,” she says. “It’s all about trying to help

The honor, the result of a peer-to-peer nomination process, is presented annually at Enterprise Minnesota’s rewards and recognition celebration.

Back row, from left to right: Business Growth Consultants Keith Gadacz, Greg Langfield, Steve Haarstad, and Samuel Gould. Front row, from left to right: Business Development Consultant Joel Scalzo, Event Planner & Business Services Assistant Constance Fantin, Business Growth Consultant Michele Neale, Business Development Consultant Dawn Loberg, and Marketing & Office Assistant Lynet DaPra. Neale received Enterprise Minnesota’s “Esteemed Colleague” award. Others received recognition with “Above & Beyond” awards.

people see their situations more clearly, in ways that help them become more profitable.

“I help them elevate their people. It’s how they can maximize that talent.”

She admits to being “shocked” by her selection for the award. “I am truly humbled and honored.” Neale says she works with some amazing people, especially Hellickson.

Results stem from true collaboration Gray Plant Mooty proudly supports The State of Manufacturing®.

Connect with our attorneys to discover how our services help clients grow and succeed. www.gpmlaw.com

“I feel like I’m in the right place at the right time,” Neale says, “and I am blessed to have great people support me. Without them, I wouldn’t be esteemed.”

“It’s like we were meant to work with each other. I feel like I’m in the right place at the right time, and I am blessed to have great people support me. Without them, I wouldn’t be esteemed.”

Neale describes her mission as helping manufacturers keep their priority on people. “A lot of times they have their eye on machines and processes,” she says, “but they have to see the people. It’s kind of like a three-legged stool. We sometimes forget the leadership development and employee development pieces.

“I believe I’ve helped open up eyes to that. People are important, and with the way that the workforce is these days, turnover can be high. Companies are trying to find the right people, so when they invest in hiring somebody, I want them to be able to retain that individual.”

Depend on Our People.

Count on Our Advice.

Accounting Tax Advisory Roseville 651-483-4521 • Eden Prairie 952-941-9242

otcpas.com FALL 2019 ENTERPRISE MINNESOTA /

11

AUTOMATION

Preparing for Technology New DEED program helps small manufacturers get their employees trained for high tech demands

M

innesota’s Department of Employment and Economic Development (DEED) recently unveiled a program to help small manufacturers adapt to demands that add automation to their plants’ capabilities.

Kevin McKinnon, DEED’s deputy commissioner, says the Automation Training Incentive Pilot Program provides training grants to small businesses implementing new automation technology. These companies are also looking to address skilled worker shortages, maintain competitiveness, and improve productivity, he adds.

“OEMs are adopting it,” according to McKinnon. “We’ve also heard that some are starting to require it in their supply chains, which affects a lot of small manufacturers.”

The new $500,000 grant program will provide grants of up to $25,000 to help small manufacturers offer staff training to cope with technological advancements. It’s a broad market. The program is limited to Minnesota-based manufacturers or other skilled production industries with 100 or fewer employees. To receive a grant, covered employees must be full-time and earning at least 120 percent of federal poverty guidelines, about $30,900 per year.

12

/ ENTERPRISE MINNESOTA FALL 2019

Currently, there are 7,000 manufacturers in the state who employ 100 employees or fewer. “We know there is a lot of demand,” McKinnon says. “We know that there’s a lack of knowledge out there, a lack of expertise. We’re hoping to help get them prepared.”

Applicants from smaller-based operations in rural areas will receive a high priority, as will companies that promise more significant pay increases for participants.

Other preferences will go to companies leveraging private funds (including their own), the rate of return on state investment, and whether participants will receive industry-recognized certifications.

Eligible training will be related to the implementation of new automation technology/equipment, such as: • Advanced technical skill training • Training on industry-specific equipment • Process/quality training • Safety training • Maintenance training • Train-the-trainer • Computer/technological skills

Funds must be used to offset direct training costs associated with training existing workers on new automation technology. These include: • Assessments, testing, and certifications • Curriculum development • Delivery of training • Trainee wages • Training materials and supplies • Trainer travel • Training equipment (on a prorated basis) Expected outcomes can include: • Continuity of operations during the implementation of new automation technology • Retained jobs • Increased wages • Trainee certifications • Increased productivity and efficiency • Enhanced job satisfaction • Increased safety Grants will be awarded June 30, 2020 on a first-come, first-served basis. Applications, approved by the DEED Commissioner, are typically turned around within a week of submission. Training must begin within six months of award and must be completed by December 31, 2020.

“This is a pilot program,” McKinnon says. “We are hoping to learn a lot through this, much like we did during the Job Training Incentive Program.” What eventually happened there, he says, was that partici-

STRATEGIC SEARCH + RECRUITING

We Find Greatness in the Grey.

When it’s time to add talent, you need an executive search and recruiting partner that sees beyond resumes and references and digs into the “grey”— the intangibles of culture and character where a deeper, lasting fit between company and candidate is found.

SATISFACTION IS GUARANTEED!

grey-search.com

DEED’s Kevin McKinnon is careful to dispel the perception that automation displaces workers.

“We don’t want to go there,” he says. “It is simply not the case.” pants in Greater Minnesota liked it so much they pushed their legislators for more. McKinnon hopes this program might experience a similar trajectory.

“We don’t know what the ultimate design will be. But we’re trying to get smarter about how we help employees receive the training they need to remain with their companies.”

McKinnon is careful to dispel the perception that automation displaces workers. “We don’t want to go there,” he says. “It is simply not the case.” McKinnon says DEED and other state agencies are using a couple of initiatives to study the future of work in Minnesota. “We believe this is a good step for our citizens working in manufacturing.”

We see your future in the making. And how to make it.

We see you.

At Bremer Bank, we understand doing whatever it takes to get things done, and that’s the approach we’ll take to helping your business grow.

Let’s see what we do can together. bremer.com Member FDIC. ©2019 Bremer Financial Corporation. All rights reserved.

FALL 2019 ENTERPRISE MINNESOTA /

13

PHOTOGRAPH BY PAULA PRIMEAU

Owner Craig Komschlies

THE FACE-OFF BETWEEN BUSINESS MANAGEMENT SYSTEMS

Can You Play on Two Teams?

Rotation Engineering discovers a way to ‘zipper together’ EOS and ISO

C

raig Komschlies has heard other manufacturers equate the two prevailing business management systems to the compatibility of oil and water.

ISO 9001:2015 emphasizes building a quality management system that requires the involvement of top management. It stresses risk management and the importance of a culture of continuous improvement. EOS—the Entrepreneurial Operating System—helps small and medium-sized companies find efficiencies and the focus to navigate the increasingly sophisticated marketplace.

“I love ISO,” Komschlies says. “And I love EOS.” Plus, he feels he needs both.

Rotation Engineering was a 37-year-old

14

/ ENTERPRISE MINNESOTA FALL 2019

company when Komschlies purchased it in 2010. The company matured from a one-person, tool-and-die shop to a sophisticated and diverse metal stamping operation whose 45 employees work from a 38,000-foot custom-designed facility in Brooklyn Park. Komschlies, originally a chemistry graduate from St. Olaf College, most recently spent 16 years as controller at Chaska Machine & Tool.

Komschlies prefers not to talk publicly about Rotation’s revenue numbers, other than to say the company has “grown substantially” since he acquired it.

So, as he plotted the company’s future growth, his radar exposed three potential impediments to growth. First, the revenuegenerating economy was not going to last

forever. “There’s always the potential of a looming recession,” he says. “It has to happen sometime.”

Second, like virtually every manufacturer, Komschlies was acutely aware that the growing shortage of potential employees would inhibit his capacity to grow. “It’s just hard to get employees in,” he says. “We have to pay more and more on a starting level, even just to get operators in—which bumps up other costs.”

And the third potential impediment: Rotation, like most manufacturers, faced constant and simultaneous pressure from customers to reduce costs.

Komschlies looked at ISO 9001:2015 as a management system. And while Rotation was ISO-certified, the new version of the system was far more oriented to company management than previous versions. But he felt it didn’t go far enough. “ISO wasn’t enough to keep our structure together to function well,” he says. “I don’t wave ISO like a banner or marketing ploy. I believe in it. And employees here at Rotation do, too. But it wasn’t enough. EOS made the difference.”

Komschlies read the book Traction: How to Get a Grip on Your Business, written by Gino Wickman, the business consultant who developed the EOS management system. Komschlies says the book “spoke to me very clearly about some of the issues

that can befall a company.” Rotation started its EOS journey in December 2017.

Rotation’s leadership team acclimated to the efficiencies and simplicity of the EOS structure, but Komschlies realized it wasn’t fully integrated with ISO. “We were focusing on the right corporate goals for EOS, but we were running parallel with ISO. I just never accepted the fact that these can’t fit together. They’re two different processes, but the goals should be the same.”

To make that happen, last September he called on Enterprise Minnesota, which dispatched a team led by Keith Gadacz, a business growth consultant with deep experience in ISO business management systems.

Gadacz laid out an action plan identifying 15 issues that needed attention as Rotation prepared for its next ISO audit.

The process sorted out some initial sticky issues as the Rotation management team worked to synthesize an array of key performance indicators. The team invested eight months before the two management systems actually “zippered” together, according to Gadacz.

“You could almost see the hockey stick show up on the chart of their metrics and indicators. Things were starting to click, from Craig and his top leadership to the second level support right behind him.”

For Gadacz, the process helped demystify the often-segregated silos of EOS and ISO. “They are essentially the same,” he says. “They are about improving the business with a set of tools and the cadence of leadership accountability that makes it successful.”

For Rotation, the systems now align.

“We now have one direction,” Komschlies says. “We don’t have two separate systems. They’re all incorporated into one system, and it’s seamless.”

The process also incorporates lean tools, according to Komschlies, which, he adds, contributes another level of complexity. “Some of our guys were using lean tools, which I also love. But you have to put it in perspective: one’s an operating system, and one is a toolbox that you can use when you see how these fit together. So, pulling those three worlds together was rather effective.”

Like a hat-trick in hockey, incorporating these three goal-making systems into one makes for one winning structure.

ESX

2018 Minnesota SBA Lender of the Year

Member FDIC

LO CA L F O C U S . G LO BA L R E AC H .

Granite Equity Partners is a mission-driven private investment and holding company.

We combine long-term business growth with a dedication to community well-being. For more than 17 years, our investment approach has delivered exceptional value for stakeholders and far-reaching impact in Minnesota – and across the globe.

320.251.1800

|

GraniteEquity.com

G OV E R N I N G A N D G ROWI N G CO M PA N I E S F RO M M I N N E S OTA

FALL 2019 ENTERPRISE MINNESOTA /

15

QMS

Reality Check Are you ready for your ISO audit?

O

ver the past three years, Enterprise Minnesota has helped more than 80 Minnesota-based manufacturers achieve their ISO 9001:2015 certification. While the certification enhances OEM relationships, savvy manufacturers also see it as a way to improve their internal management structure.

But ISO 9001:2015 practices, like strategic plans, don’t mean much to a company if they aren’t implemented.

That’s why Enterprise Minnesota is launching an effort to reach out to ISO clients and ensure they properly prepare for the annual audits that are essential components of the certification process.

Toward that end, Enterprise Minnesota President and CEO Bob Kill is planning to personally communicate via a letter, this fall, with his company’s ISO clients. His consultants want to check that employees embrace its value and use it in their work and show that ISO is helping clients better manage their operations.

“The obvious question is, ‘Are companies prepared?’ We’re seeing that many aren’t,” Kill says. “We know from firsthand experience that the first audit is different.” Enterprise Minnesota is itself ISO

16

/ ENTERPRISE MINNESOTA FALL 2019

certified and understands the depth and peculiarities of an ISO 9001:2015 audit.

“You used to be able to say, ‘Here’s the process and we follow it,’” Kill says. “It is now driven by how you are living it. There is help available to make integration easier so it can be used as a management system.

“We (at Enterprise Minnesota) use it as our management system,” Kill says.

ISO 2015 represented a dramatic change from previous versions of the standard.

Framers established the 9001 standards in 1987 to assure uniform international quality requirements between procurers and suppliers. They all emphasized processes, Kill says, but ISO 2015 de-emphasized procedures and evolved into a holistic management tool.

Less prescriptive than previous versions, ISO 9001:2015 emphasizes building a management system that requires the involvement of top management. It stresses risk management and the importance of a culture of continuous improvement.

Keith Gadacz and Patricia Pearson hope the letter will serve as a “wakeup call” for manufacturers who might use current demands for increasing business as an excuse to let ISO slide as a company

priority. Gadacz is a business growth consultant at Enterprise Minnesota who uses his extensive experience in implementing and managing ISO 9001 and ISO 13485 quality management systems to help Minnesota’s manufacturers build the systems into their company cultures. Similarly, Pearson is a business growth consultant

Gadacz says many manufacturers are less aggressive about ISO because they are so busy fulfilling sales.

“They can’t keep up,” he says. who specializes in using business management systems to help manufacturers drive performance.

Gadacz says many manufacturers are less aggressive about ISO because they are so busy fulfilling sales. “They can’t keep up,” he says. “They haven’t thought about their system for a while, so maybe they’ve been running on autopilot.”

“I want them to think critically about the effectiveness of their audits and management review to make their business better,” Gadacz adds.

Gadacz emphasizes the value of ISO 9001:2015 in helping companies cope

with the demands of increased business.

“The 2015 standard is a holistic business system,” he says. “It’s very similar to every other thing you touch. It ties everything together into a great management system.”

Pearson describes the 2015 revision as “the most significant revision that ever happened to the standards. We don’t even look at it as ISO anymore, we look at it as a business management system.

It starts at the strategic level and then it flows down into the tactical levels.”

Gadacz agrees: “It puts accountability on top management, those who decide the direction of the organization,” he says. “It doesn’t allow delegation, even though tasks may be delegated, and ownership and accountability of the processes remain with top management.”

He adds that ISO’s effectiveness is maximized through a continual process of internal auditing.

“The aim is a continual process of review and assessment to verify that the system is working as it is supposed to,” he says. “We can also find out where it can improve and correct or prevent identified problems. It is considered healthier for internal auditors to audit outside their usual management line because it brings a degree of independence to their judgments.”

Internal audits are a “self-check loop,” Gadacz says, to ensure that the management system takes place and is adjusted to the needs and interests of stakeholders.

Internal audits can be poorly conducted when they involve a checkbox for compliance versus leveraging the inputs and outputs of big processes and subprocesses for optimization and process performance. “Are those processes and sub-processes delivering what you expect, when you expect it, in the way you expect it so your internal and external customer get what they need the first time?”

A good auditor, Gadacz says, wants to find improvements for the business. A trained auditor wants to be compliant to the standard. An untrained auditor wants to just get it over with.

“A good auditor has a vested enthusiasm in the organization, has an eye for improvement, and sometimes an eye for seeing the abnormal. What could be better? If you just see normal you can never see better, and you can never see worse, so you just see normal.”

TAKE PART IN MANUFACTURING WEEK (OCT. 1-7) Join DEED in promoting public awareness about all that Minnesota manufacturing has to offer. For more on tours, events and activities, visit mn.gov/deed/mfgweek

Look to DEED for help with: ● ●

Finding new employees Specialized training grant programs

● ● ●

Business financing programs Shovel-ready development sites Export and trade assistance

FIND OUT MORE: mn.gov/deed/business

We love to exceed your expectations.

What you expect.

What you get.

Productivity machine tool purchases come with service, training and applications support. And, as a single-source machine tool supplier, you have access to all our products and services to help you succeed. You can count on Productivity to always deliver more than expected.

Let us exceed your expectations today!

MINNESOTA 763.476.8600

IOWA 319.734.3403

NEBRASKA 402.330.2323

PRODUCTIVITY.COM

Machine Tools | Tooling & Accessories | Robotics & Automation | Service | Applications Engineering | Preventive Maintenance Rotary & Live Tool Repair | Integrated Supply | Machine Moving | Used Machines | Training

FALL 2019 ENTERPRISE MINNESOTA /

17

Four Questions DEED Commissioner Steve Grove

A

re there particular advantages to coming in from the private sector, as you did?

You do come in with fresh eyes because you don’t know exactly how the government works. There’s a learning curve, but at the same time, you can ask questions that get to the root of an issue. One thing we’ve recently done at DEED is refresh our mission and values. I used my personal business background as a guide for a new strategic plan and system called Objectives and Key Results.

It’s more than just, “Hey, we want to do this or that activity.” Its focus is on outcomes and what numbers and strategies we need to achieve those outcomes. When government can benefit by operating a little more like a business, we lean into that, and where it wouldn’t be a benefit, we are honest about that, too. Good workplace culture isn’t just about being a fun place to work. It’s also about making us more effective in all the work that we do.

How do you outline your vision and strategy for DEED? We have several key objectives for the agency. First, we want to make Minnesota’s innovation economy a national leader. We want to end up on a series of Top Five lists. We want to increase the number of innovative businesses that we deliver our incentives to by 25 percent—and we’re not just talking about tech startups, but any business that’s using new technology to get demonstrably better.

We also want to double the number of job seekers we hit with tech training. Second, we want to reduce the disparities faced by populations with traditional barriers to employment.

We want to find a two-dollar-anhour bump in wages for people of color and have every single program at DEED—there are around 70 or so— incorporate measurable objectives related to equity. Finally, we want to

18

/ ENTERPRISE MINNESOTA FALL 2019

grow Minnesota’s workforce for our businesses now and in the future.

We want to increase the percentage of people who use our career force services, both online and in person.

We want people to think of our system as a really great and powerful place to find workers.

“Launch Minnesota” is a new DEED program that provides financial

INNOVATIONS

incentives, training, and grants to people starting companies in technology sectors. It has received a lot of good buzz in the business community.

The Launch Minnesota initiative is exciting. Economic development at the state level generally focuses on what you might call the usual recipients—manufacturing, forestry, mining. They are all important industries, but we haven’t spent as much time focusing on the startup ecosystem

Steve Grove

Steve Grove is the commissioner of Minnesota’s Department of Employment and Economic Development. He most recently spent 12 years at Google, where he helped found Google’s News Lab—a global division that partners with media companies and startups to drive innovation in the news industry. He holds a master’s degree in public policy from the Harvard Kennedy School and a B.A. in philosophy, politics, and economics from Claremont McKenna College.

or entrepreneurs. Launch Minnesota has only five million dollars in new spending, but it’s a valuable opportunity to build a brand around Minnesota becoming a Top Five national leader for its innovation economy. I think the pilot we’re doing with Enterprise Minnesota is an excellent example of that. We can focus on smaller manufacturers and incentivize them to do automation in a way that works for them, and we can help fill the gaps in the training required to make that transition. We also just got funding to

I am surprised the level of complexity in our workforce development system doesn’t always lead to optimal outcomes. do a future-of-work study that asks honest questions to determine where our economy is headed: “Are we ready?

Are businesses ready? Is our workforce system ready for what’s to come?”

That’s really exciting to me.

Was there a particular aspect of this job that came as a surprise?

I am surprised the level of complexity in our workforce development system doesn’t always lead to optimal outcomes. You’d like to think that we have a diverse system where the whole is greater than the sum of its parts.

But I believe we are in a situation now where the whole is less than the sum of its parts; stakeholders are at odds more often than they should be.

There’s not a common goal. Nonprofits focus on the equity slice of workforce, and local workforce boards focus on the geography of the workforce challenge. And then there are federal grant dollars and state grant dollars.

Everyone wants to grow our workforce, but often people are fighting over the same block of cheese, and it’s not going to get bigger. We’re trying to use this workforce crisis to call people to something greater than just fighting over resources.

BUSINESS STRATEGY:

On Purpose or by Accident?

Business growth expert Patrice O’Malley will show you how to rethink and retool your strategy to manage challenges and capture growth opportunities.

This event is exclusive to manufacturers and is free of charge. Registration required.

Patrice Tuesday, Sep 24, 2019 O’Malley 9:30AM - 11:30AM The Tuscan Center - Ballroom 3333 W. Division St. St. Cloud

Register at events@enterpriseminnesota.org FALL 2019 ENTERPRISE MINNESOTA /

19

COLLABORATION

Common Interests How the West Central Initiative and Enterprise Minnesota partner to create jobs

O

ne day in the early 1990s, Wally Stommes hooked up with Bill Martinson, a business development consultant at Enterprise Minnesota (then called Minnesota Technology, Inc.). Stommes and partner Gerry Nelson had just co-founded StoneL, a Fergus Falls-based manufacturer of valvemonitoring products that send electronic messages to a processing plant’s control room regarding the status of its valves.

Both men had been working at Proximity Controls when they came up with an idea for a new valve monitoring device, but it was an idea that Proximity Controls swiftly rejected. So, Stommes and Nelson left Proximity and launched StoneL (a combination of their last names). They turned their idea into the company’s first product line.

But Stommes and Nelson’s vision was broader than simply making a great product; they wanted to secure a great workforce that was well-trained and loyal, and an operation that was as efficient as possible. After discussions with Martinson about available trainings and programs, StoneL worked with Enterprise Minnesota to identify programs that would have the biggest initial impact, including lean and continuous improvement trainings. As StoneL’s devices gained traction in the market and the company became a global player, Stommes and Nelson took advantage of Enterprise Minnesota offerings such as Self-Directed Work Team training, Value Stream Mapping training and Training Within Industry (TWI). In 2000, StoneL was sold to Metso Corporation, a Finland-based global manufacturer.

Since then, it has more than quadrupled its revenues, added more manufacturing capabilities and constructed a new facility.

In recent years, StoneL prioritized Practical Problem Solving and ISO 9001 upgrade

20

/ ENTERPRISE MINNESOTA FALL 2019

Wendy Merrick, director of programs at WCI.

training, which Enterprise Minnesota administers.

The StoneL experience showcases that building a talented and loyal workforce takes time and resources, something a small manufacturer doesn’t always have. “One of the most important things an employee can get from an employer is that he or she is appreciated. It helps the entire region; the employee stays invested because he or she sees a future here,” Martinson says.

That’s when public-private community partnerships can be important—when organizations with aligned missions can serve the economic development needs of an area better than they ever could on their own. In fact, all of the trainings for StoneL and other west central Minnesota companies could not have happened without the funding support of the West Central Initiative (WCI).

WCI, a community foundation, serves nine counties in west central Minnesota in the areas of business development, community development, early childhood initiatives and workforce development. In

the early 1990s, WCI analyzed 1990 census data and predicted widespread labor shortages. To address this risk, it launched the Workforce 2020 Grant Program. Workforce 2020 funds or partially funds the cost of bringing world-class experts to the region to increase local companies’ competitiveness through worker training.

“It was visionary,” Martinson says. “They knew the region needed a stronger workforce. The pay levels here were on the low end compared with the rest of Minnesota.

They saw a future workforce shortage because of this. It was really visionary on WCI’s part to put together a program and dedicate grant money for workforce development.”

The hurdle was getting Workforce 2020 out into the community. In manufacturing terms, WCI needed a distribution channel.

Because of its network of deep relationships with manufacturers and its membership in the national Manufacturing Extension Partnership that connects companies to the best trainers in the U.S., Enterprise

StoneL was among the first companies to take advantage of the relationship between WCI and Enterprise Minnesota.

Minnesota was a natural partner for WCI. “We rely on Enterprise Minnesota to talk with companies and find out what support they need to do things like increase productivity or to compete in the market,” says Wendy Merrick, director of programs at WCI. Enterprise Minnesota works with local manufacturers to identify trainings and programs that can improve their profitability and productivity. If a business chooses to implement a new approach or technology, Enterprise Minnesota helps the business define its needs and prepare a Workforce 2020 application. If WCI approves an award, Enterprise Minnesota administers the funds. When the project is concluded, Enterprise Minnesota works with the business to prepare a brief report describing the accomplishments of the project.

Nearly 30 years later, this mutually beneficial partnership continues. At its core, the work is about listening to a manufacturer’s needs, not pushing an agenda. “Bill [Martinson] is not out to sell our services or Enterprise Minnesota services; he goes in to listen,” Merrick explains. “He has resources worldwide, so these companies are getting world-class services from the best-of-thebest trainers. This partnership is about, ‘How can we support small manufacturers in a way that’s good for the economy of west central Minnesota?’”

One partnership, regional impacts

The partnership’s work with companies like StoneL can affect an entire region.

Merrick explains that when a company grows and is successful, it has the capacity to give back to the entire community. For example, Gerry Nelson of StoneL served on the Labor Force Development Council (LFDC)—a voluntary association of leaders in business, K-12 education, higher ed, economic development, government and other industries—that shares resources and plans strategic initiatives to attract and retain a strong labor force that is responsive to the

needs of area employers.

In a video for WCI, Nelson explains why the LFDC is important for west central businesses and the entire region. “We have had outstanding employees who have come from this area or who have moved back to this area to work for us. I just want to say a great big thank you not only to West Central Initiative for supporting us as a company— it would’ve been a much tougher time if they hadn’t been there—but to all of the companies that they work with in the area.”

A partnership like no other

The public-private partnership formed between WCI and Enterprise Minnesota didn’t have a template. In fact, there was no other program quite like it. “People from other parts of the country would come to look at us,” Martinson says. “Their missing link was usually not having a partner like Enterprise Minnesota. They didn’t have that distribution channel where someone was seeing the need and setting up projects.”

The partnership has built a stronger regional workforce. Studies commissioned

by WCI have found that turnover among companies that accessed Workforce 2020 is lower and statistically significant.

In addition, WCI reports that the region saw a 60 percent gain in full-time jobs from 1990 through 2014—the highest percentage increase of any Minnesota region.

Wage increases were also in line or, in some cases, higher than other regions of the state.

While WCI doesn’t claim to have singlehandedly shaped these results, it says at least part of the success can be attributed to the thousands of employees who have been impacted by Workforce 2020 and the intensive development and trainings by area employers.

“When you have higher wages in an area, you improve lifestyles and get more economic activities because there’s more money to be spent and a higher standard of living,” Martinson says.

Do you get Enterprise Minnesota’s Weekly Report?

More than 7,000 people already receive Lynn Shelton’s timely and insightful reports in their email.

Want to join them?

FALL 2019 ENTERPRISE MINNESOTA /

21

Profile

Tested

by FIRE

Dotson Iron Castings showcased its commitment to leading edge management as it recovered from a potentially catastrophic fire

By Robb Murray

22

/ ENTERPRISE MINNESOTA

FALL 2019

D

Denny Dotson

PHOTOGRAPHS BY PAT CHRISTMAN

enny Dotson got the call late on a Friday night in September 2017. It was the kind of call no business owner ever wants to get.

His foundry was on fire.

Dotson hopped into his car and raced toward the plant. He wasn’t sure what he’d see when he got there, but he wondered as he drove down a dark, southern Minnesota road whether the business he’d worked a lifetime to grow, a business that had given his family everything and meant so much to so many dedicated employees, would still be standing.

Then, another call came.

“The fire chief said they’re pulling all their people back,” Dotson recalls, “and that we’re going to lose the entire building.”

The entire building.

He drove on, not knowing if the company would even be there when he arrived.

Company President Jean Bye received the news while attending an industry event in West Virginia.

“They said, ‘There was a little fire,’” Bye recalls. “Then they called again, ‘Well, it’s too strong, they’re going to pull out.’

And again, ‘Well, they got it back under control.’ This went on every 20 minutes.”

On the first flight back to Minnesota, Bye began to plot a rescue strategy.

When Denny Dotson arrived at the foundry, he saw dozens of firefighters from three different departments were able to save most of the foundry. The damage was extensive—to the tune of roughly $5 million—but no one was hurt.

The time required to make repairs would mean that some workers wouldn’t be able to do the work for which they were hired, despite the company’s best efforts to keep production moving. Instead of laying people off, Dotson decided to pay its workers to volunteer at community nonprofits, all while earning their full hourly wages.

Some workers volunteered at a charitybased thrift store. Others helped caulk and seal cement at a North Mankato hockey rink.

Still others spent a few weeks helping a nonprofit in Mankato that caters to the elderly.

The foundry was up and running at full

capacity in a matter of weeks. And not one employee lost a penny.

This story illustrates several reasons why Dotson Iron Castings is a leader in the industry, and why it’s no surprise the company has been on the forefront of adopting and embracing lean manufacturing techniques to make its operation as efficient—and as profitable—as possible.

Dotson is on the smaller side as foundries go, but its size enables the company to be nimble, respond quickly to change, and attract industry partners and prospective employees.

Dotson responds to the workforce challenge by encouraging employees to feel a sense of ownership for what happens at the company, like they’re part of a team or, perhaps, a family.

Next-level lean

From the outside, Dotson Iron Castings looks like a gray behemoth. Nestled a FALL 2019 ENTERPRISE MINNESOTA /

23

Dotson’s leadership. Front row from left: Josh Jaycox, Jean Bye and Liz Ulman.

Back row from left: Jim Headington, Eric Nelson, Mike Kinning and Denny Dotson. Missing is Tyson Twait.

football field away from the Minnesota River, you’d expect to enter the premises and find a dirty operation run by burly men with smudged faces, black boots and thick gloves.

But Dotson Iron Castings defies those expectations.

From the minute you walk in, you notice how clean it is. And new. And polished.

The entryway greets visitors with a subtle message: Forget everything you thought you knew about foundries. This is the foundry of the future.

And Denny Dotson greets visitors with a bright smile and a firm handshake.

“You passed our IQ test!” he says, referring to the touch-screen security system all visitors must navigate for entry.

He leads visitors into the office of Vice President Eric Nelson, who is monitoring a software program that shows a 3D model of the furnace that is the heart of the foundry. Every tailor-made iron casting produced in this plant is born in this fiery furnace.

Having it safely run at peak efficiency is everything for Dotson Iron Castings.

Nelson points to the screen. The image shows a cross-section of the furnace and all its parts including, importantly, the cooling aspects.

“So on this one, we’re looking at the furnace, actually a cut-out of the furnace.

24

/ ENTERPRISE MINNESOTA

FALL 2019

And I want to know about the Faraday ring—that top cooling ring—and where the temperature has been. We’re melting iron at three and a half megawatts. And over here we’re running 100-degree water. We need to be below roughly 220 degrees on the surface. So, we’re asking an awful lot in a relatively small area.”

The furnace is equipped with postproduction sensors that give real-time data about every inch of its operation. By adding smart technology to a complicated and important piece of equipment, the furnace goes from simply achieving lean to, as Nelson calls it, “the next level” of lean.

“The other piece that Industry 4.0 is heading toward is getting the right sensors, then the connectivity for those sensors, and finally having the right amount of speed to collect that data,” Nelson says. “The initial wave of lean talks about, ‘Everything’s working properly, and we want to move things through fast and efficiently.’ The second stage is, ‘What are all of the interruptions that prevent a system or a piece of equipment from operating efficiently?’

That’s part of the system. If that piece goes down, then the product doesn’t flow through. There are a thousand pieces that could shut down our plant today. So, if any one of those thousand pieces go out, our plant stops making product. We could go

out for 10 minutes, or we could go out for 10 weeks.”

Which is why knowing exactly what’s happening on key equipment is critical to the company’s success.

As electronics have improved, Dotson has added more and more sensors, Nelson says. “And what’s catching up now is the data behind that, to be able to grab that information and do something with it, and find where the problems really are.”

For example, let’s say a production line is supposed to be running at 100 units per hour. But for some reason it’s running at 90 units per hour. Of those 90, 90 percent of the units produced are flawless. This gives the line an efficiency rating of 81 percent.

Nelson says taking that deep dive, examining equipment on a “next level” lean approach, is the most cost-effective way to improve efficiency and, hence, profitability.

The people have already been hired, the equipment has already been paid for. Now it’s time to harvest every bit of efficiency possible from a trained workforce to datadriven equipment.

“Ten years ago, very few people were looking at this second phase of lean,” Nelson says. “The second stage of lean, in our opinion, would be: How do you keep everything working so you have the overall effectiveness of the whole plant?”

Get ‘em, keep ‘em

Dotson, like virtually every other manufacturer in Minnesota, is having to contend with the skills gap.

In Enterprise Minnesota’s 2019 State of Manufacturing® survey, business owners were asked, among many other things, “What would you say are one or two biggest challenges your company is facing that might negatively impact future growth?”

The number one response was attracting and retaining a qualified workforce.

Dotson responds to the workforce challenge by encouraging employees to feel a sense of ownership for what happens at the company, like they’re part of a team or, perhaps, a family.

When the fire hit the foundry, for example, Dotson could have understandably told workers, “Sorry, folks, but until we’re back up and running, there’s just nothing for you to do here. We’ll call you when production

starts back up.”

Instead, the company continued to pay its employees. But it didn’t just pay them— it also gave them purpose and put them in positions to 1) feel good about staying busy and productive, and 2) be proud they work for a company that cared enough about them to prepare such an altruistic program.

For similar reasons, Dotson includes its workers in every aspect of facility improvement, especially equipment purchases. And not just to “ask for input.”

At Dotson, showing workers that they’re a vital link in the process can sometimes require passports. When the company is considering purchasing, for example, a new robotic system, it will send employees who would work on that equipment to the source to see it in action. If that means Japan, that’s where the workers go. And if this sounds like an excuse to send people on a vacation, well … it is and it isn’t. Having employees test drive a new machine

Dotson Iron Castings also rises above its peers in wages.

According to the Bureau of Labor Statistics, average manufacturing wages range between $14 and $18 per hour. Dotson employees start at more than $22 per hour.

conveys valuable information to Dotson’s leadership, but it’s also an investment made in retaining employees. An employee goes to Japan to check out a forklift and can also relax and see some sights. That employee then comes back with actual knowledge and a better appreciation for a company that values its employees enough to send them overseas.

The same principle holds for on-site maintenance. When equipment needs repair, the employee who uses that piece of equipment assists the maintenance technician, giving that employee a new appreciation for the technician’s work and a deeper

“We are the only nonautomotive foundry that has automatic pouring of metal,” Dotson says. “The worker is no longer standing over hot metal and working very physically hard on it.” understanding of the inner workings of the machine he or she works on all day.

Dotson has even transformed the very idea of what it means to work in a foundry.

Instead of the smudge-faced, big-gloved job you might imagine, Dotson employees spend much of their work day at a PC, cutting out much of the danger and producing, in the end, a more consistent product.

“We are the only non-automotive foundry that has automatic pouring of metal,” Denny Dotson says. “The worker is no longer standing over hot metal and working very physically hard on it.”

This brings a benefit that goes beyond the employee, he explains. “There’s also a benefit to shrinking variation on the process. If an employee is working physically hard in a hot environment, it’s unlikely he or she will be as concerned with proper pouring techniques. By putting in automatic equipment to handle that, we take out a lot of the process variations.

“Twenty years ago, we used to have people loading wheelbarrows with metal that was then loaded into our furnaces.

Today, there are no people involved in that process. It is all done by computercontrolled weights, scales and magnets.

The operator punches a recipe and says, ‘I want recipe number six.’ Everything is FALL 2019 ENTERPRISE MINNESOTA /

25

You would expect to find a dirty operation run by burly men with smudged faces, black boots and thick gloves. But Dotson Iron Castings defies those expectations. done automatically. We took a hard, physical job and eliminated it, and we improved the process quality because the variation is much, much less.”

Many of Dotson’s workers are crosstrained. The company, in an effort to foster a flexible pool of workers that can be plugged into any task, encourages workers to become trained in areas other than their own. And if they like it, there’s a chance they can be moved to a different area of the plant. This comes into play on days when workflow dictates how much each set of workers has to do.

“If we have a skilled person in our finishing department who might not have work to do on a Friday afternoon, but we have plenty of work to be done in our 26

/ ENTERPRISE MINNESOTA

FALL 2019

tooling area, we might move that person over to that area,” Dotson Vice President Liz Ulman says. “So, we’re trying to keep them more flexible with utilizing their skill sets. Sometimes, they then might look at that and go, ‘Oh, I kind of like this job.’

And then we might try to develop them for that position or offer them education or tuition reimbursement to go back to school and move into that department.”

Dotson Iron Castings also rises above its peers in wages. According to the Bureau of Labor Statistics, average manufacturing wages range between $14 and $18 per

hour. Dotson employees start at more than $22 per hour.

“Our employees can make $22.10 an hour right out of high school,” Ulman says.

And with the company’s tuition reimbursement program, new workers can work and go to school. She cites a recent high school graduate who wanted to get a machining degree from South Central College. It was June and school didn’t begin until September. “So, we hired him as a production employee. He’s working full time, getting paid $22.10 per hour, and we’re paying for him to get a machining degree.”

Dotson’s tuition-assistance program makes sense on several levels. Paying employees to better themselves results in better-educated, more efficient and highly skilled workers. But what if that worker’s urge for education takes him or her away from something directly tied or related to the job performed at the plant?

That’s okay with Dotson, too.

“We’ll reimburse 50 percent on anything they want to do. Even, say, learning to fly an airplane,” Denny Dotson says. “If someone’s excited about learning to fly a plane while working here, they share that excitement in the workplace environment.

And that’s good.”

Dotson/Bye combo

Dotson Iron Castings goes back a long way, back before its current CEO was born. The company was founded in 1871 in Mankato by a German immigrant and blacksmith named Laurence Mayer.

Company lore has it that the original foundry sat just 300 feet away from the current location. The original company had developed a reputation for innovations that made foundries safer and more efficient. In addition to producing iron, the Mayer-led foundry launched other ventures as well, including an automobile powered by the world’s first V8 engine.

The company’s name was changed to Little Giant in the 1920s when it started producing plumbing parts and potato pickers.

Little Giant persisted through the Great Depression until the 1940s when it finally was sold out of bankruptcy. But later on, the company flourished due to the demands of World War II. In the late 1940s, the first Dotson—Jerry—entered its realm. The company grew during the ‘50s and ‘60s, and Jerry took over. He changed the name to The Dotson Company and oversaw its continued growth.

Denny, after working at the company as a teen, attended the University of Notre Dame and did a stint in the U.S. Navy before returning to work for his father Jerry in 1972. Around the same time, another new worker arrived: Jean Bye, the company’s current president. The two would become lifelong friends and steer the company where it is today, but not without some economy-driven ups and downs.

The 1980s were dark times for manufacturing plants. Many suffered catastrophic losses. Others simply gave up. But not Dotson. Profits were down 80 percent at one point. The company’s workforce went from 425 to 87 in just a six-month stretch.

To save their sinking ship, Dotson and

Bye asked employees to accept a temporary 40 percent pay cut. They vowed to repay the lost wages with interest. Their move worked, and what was left of the workforce was there for a big turnaround.

And they each received their backpay.

(Another event that helped was the creation of President Reagan’s Manufacturing Extension Partnership, aimed at helping small manufacturers through tough times. Dotson told the Washington Post a few years ago that, without the MEP, the foundry would likely have folded. That program, Dotson says, is in danger of being cut by President Donald Trump.)

Like Dotson, Bye came to Dotson Iron

When the company is considering purchasing, for example, a new robotic system, it will send employees who would work on that equipment to the source to see it in action. If that means Japan, that’s where the workers go.

Castings as a teenager, working summers at the foundry before heading off to earn a business degree at Concordia College.

Degree in hand, she stuck with Dotson Iron Castings, working her way up from the human resources department to vice president of administration. She was named president in 2010.

Bye’s status as a leader in the industry is a solid one. She’s been a board member of the Ductile Iron Society and the Mankato Area YMCA, is the past president of the American Foundry Society, and a board member of the Minnesota Safety Council.

Just this year, Bye was given the Women in Manufacturing STEP (Science, Technology, Engineering and Production) Ahead Award, which is bestowed upon women who have “demonstrated excellence and leadership in their careers and represent all levels of the manufacturing industry, from the factory-floor to the C-suite.”

“Jean Bye has provided exemplary leadership as both the President/CEO of Dotson Iron Castings and as 2018-2019 President of the American Foundry Society (AFS),” Doug Kurkul, CEO of the American Foundry Society, said in a press release about the award. “She has also served as

an inspirational role model for hundreds of women in the metalcasting industry throughout North America.”

Denny Dotson’s bona fides are just as impressive. He served on the board of the Mankato Area Foundation, was chairman of People Driven Performance, chair of the National Institute of Science and Technology’s Manufacturing Extension Partnership advisory board, U.S. representative to the World Foundry Organization, past president of the American Foundry Society and past trustee of the Minnesota State Colleges and Universities system.

When speaking of the fire, Denny Dotson doesn’t hesitate when asked how they were able to come through that challenge relatively unscathed.

“We recovered from the fire spectacularly,” Dotson says, gesturing toward Bye. “But it was because we had an incredible organization and a team that played well together. And it really was Jean’s leadership in that process that made all the difference.”

“It was really the whole team,” Bye replies.

“I’m sorry,” Denny says, looking at Vice President Liz Ulman. “Whose leadership was key in this situation?” Ulman points to Bye. “We made a decision very early on, within hours on the first day, that employees would be back at work. The fire was on a Friday, we wanted employees back at work on Monday. And then we spent a great deal of time to find work for them.

We had people focused on all the different areas, and then Jean solved the ‘in-between’ problems.”

Ulman says that, after the fire, when all the damage was repaired and all the workers were back at work in the foundry and Dotson Iron Castings was running at peak production again, she spoke to a recruiter who’d asked about the company culture.

“I told him, ‘You know, I can give you all the information you need, or you can read our website. You can read our fancy brochures that say this is who we are and this is what we do,’” Ulman says. “But in the unfortunate circumstance of the fire, everything that we say about who we are and what we do and how we want to treat people—whether that’s our customers, our employees, our vendors, or the community—goes beyond just talking the talk. We walked it, and it showed tenfold. We had an abundance of applicants who came to us and said, ‘We heard what you did with your employees; we want to work for a company like that.’”

FALL 2019 ENTERPRISE MINNESOTA /

27

EXPERTISE

MANUFACTURING’S

GRAND ENABLER MEP’s national network of state Centers— Enterprise Minnesota among them—offer affordable, cutting edge consulting to manufacturers

By Maria Surma Manka

T

he Manufacturing Extension Partnership (MEP) just might be among the most valuable consulting ally to manufacturers that they’ve never heard of.

Congress created MEP in 1988 to help strengthen the competitiveness of small and mid-sized manufacturers in the face of domestic de-industrialization and the rise of foreign competition. MEP resides within the U.S. Department of Commerce under the auspices of the National Institute of Standards and Technology (NIST).

From its office in Gaithersburg, Maryland, MEP maintains partnerships with a network of Centers in all 50 states, plus Puerto Rico. Enterprise Minnesota is one of them. Each Center leverages the expertise, resources and funding assistance from MEP but also offers its own programs, funding sources and focus areas, tailored to the particular needs of that state’s manufacturers.

“Manufacturers who work with MEP Centers are likely drawing on the expertise of all 50 states and the 1,300 people behind them,” says Mark Schmit, MEP’s chief of regional and state partnerships.

Members of MEP’s robust network share best practices, resources, and experts in

28

/ ENTERPRISE MINNESOTA FALL 2019

areas such as new product development, R&D, cybersecurity, exporting, reshoring, workforce development, lean practices, and more. MEP Centers can help a company solve nearly any problem. “A lot of what MEP does revolves around working with companies to help them save money and grow their business so they can compete globally,” Schmit says.

“Wherever your manufacturing opera-

“Most large consulting firms aren’t interested in these smaller manufacturers,” Bob Kill says. tions are in the country, there’s an MEP resource within a three-hour drive.”

That’s acutely helpful for small and mid-sized manufacturers, which comprise most of the manufacturing industry across the country. In Minnesota, about 70 percent of the approximately 8,300 state manufacturers employ 20 people or fewer, and the vast majority operate outside of the Twin Cities region.

“Most large consulting firms aren’t interested in these smaller manufacturers,” Bob Kill, president and CEO of Enterprise

Minnesota, says. “Manufacturing policy cannot succeed through one-size-fitsall ideas. The MEP partnership brings funding, services, and expertise to small companies and can be a life-saver for them so they can continue contributing to the lifeblood of the local economy.”

T

o observe the value of the MEP connection, one need look no further than Pequot Tool, the Jenkins, Minnesota machining and fabrication company.

Like many small and mid-sized manufacturers, Pequot Tool realized that building its leadership team from within represents a savvy HR strategy to retain quality workers in an ever-shrinking job market. But Pequot Tool also acknowledges that overseeing people and effectively communicating are skills that don’t come easily to some managers.

Laura Stromberg, a human resources specialist at Pequot, says she wanted to launch a new cohort of freshly promoted leads with the tools to succeed. “We wanted them to know how to effectively communicate with direct reports from the very beginning,” she says.

Lacking the in-house resources or expertise, Stromberg turned to Enterprise Minnesota to deliver training that would

Laura Stromberg, HR specialist and Joe Goerges, co-owner, Pequot Tool

“We wanted them to know how to effectively communicate with direct reports from the very beginning.”

—Laura Stromberg, human resources specialist at Pequot Tool help transform its managers into leaders.

“Seventy to 80 percent of new hires leave because of a person, not because of the job,” says Dawn Loberg, the business development consultant at Enterprise Minnesota who worked with Pequot Tool.

Loberg immediately suggested several programs—Learning to Lead, Practical Problem Solving, and Training Within Industry (TWI)––to strengthen Pequot’s new and existing leadership bench.

Each program equips leaders with ways to approach employee challenges and methods for effectively communicating and positively managing change.

Practical Problem Solving, for example, shows frontline supervisors how to address problems within a standardized, systematic framework.

Exposure to such programs can be a game-changer for how companies teach communicating, manage change, and address conflicts, Loberg says. In practice, this enables Enterprise Minnesota experts “to have a local business conversation with a national set of resources behind them,” according to Kill. The TWI training used by Pequot Tool, he says, is a decades-old program initially designed for large companies. “Experts at MEP scaled the training to a place that was digestible and effective for smaller manufacturers. We can help bring those resources to manufacturers in any corner of Minnesota.”

Stromberg says the training yielded some significant “aha” moments when company leaders realized they were having similar challenges with the same thing or person.

Managers gained perspective on people or FALL 2019 ENTERPRISE MINNESOTA /

29

can bring in our experts and transform companies. Even if they’re in a rural area, the partnership gives our clients access to an extremely high level of expertise.”

It takes a network

“Helping small and mid-sized manufacturers grow will help strengthen and grow our communities and jobs, too.”

—David Boulay, president of IMEC, the Illinois MEP partner problems by sharing these experiences, she says. “It’s easy to get tunnel vision.

Hearing from other managers gives the whole story, and that’s a key first step in the problem-solving approach.”

Pequot Tool’s leaders have made a longterm commitment to implementing the lessons they’ve learned from Enterprise Minnesota, according to Stromberg. “They recognized some of the departmental breakdowns in communication between themselves and have been truer with each other about intent and needs for action.

They have also used an open style when taking corrective action, which has created less tension in the workplace.”

“The [training] re-invigorated them as leaders and generated a lot of positivity,” she adds. “I don’t think we’ll ever stop this kind of training; we’ve found too much value in it. I’d recommend this for any company.”

The high-quality training and programs that Pequot Tool experienced wouldn’t be possible without MEP’s guidance.

“There’s no one in northern Minnesota who could’ve taught Training Within Industry,” Loberg says. “But with the support of MEP, we at Enterprise Minnesota 30

/ ENTERPRISE MINNESOTA FALL 2019

The MEP partnerships replicate their impact throughout the U.S. David Boulay is president of IMEC, the Illinois MEP partner. Like Minnesota, Illinois manufacturers are prioritizing workforce development and skills training, but there is also a strong focus on maximizing ERP software, cybersecurity, and the implementation of the latest technology and automation, often referred to as “Industry 4.0,” Boulay says. “MEP gives us access to the know-how on the national level to help address the needs of a manufacturer in Illinois. Helping small and mid-sized manufacturers grow will help strengthen and grow our communities and jobs, too.”

Bonnie Del Conte is president and CEO of CONNSTEP, the Connecticut MEP partner. The ability to share and collaborate throughout the MEP network fuels and diversifies the expertise delivered to local manufacturers. “I look at what goes on in New England with the other MEP Centers, and I look for things that will strengthen our entire region,” she says. Working with other Centers, Del Conte’s team developed services to help food manufacturers comply with food safety regulations. Each Center collected data about the needs and challenges of food industry clients and then compared that data to find similarities and develop solu-

“Manufacturers who work with MEP Centers are likely drawing on the expertise of all 50 states and the 1,300 people behind them.”

—Mark Schmit, MEP’s chief of regional and state partnerships

tions together. “We couldn’t have done that individually,” Del Conte says.

By building public-private partnerships across the nation, MEP delivers muchneeded expertise at rates no Center could afford to develop on its own. “Large manufacturers can address problems like costcutting or workforce development head-on.

Small and mid-sized companies usually don’t have the resources,” Kill says.

Donnelly Custom Manufacturing, located in Alexandria, Minnesota, is another example of MEP’s influence. A short-run plastics injection molder, Donnelly has partnered with Enterprise Minnesota for nearly 30 years for training, seminars, participation in Peer Councils, and assistance in the company’s lean journey and strategic planning process. Like Pequot Tool, Donnelly also implemented TWI and Practical Problem Solving.

“We have attended many training events, which provide not only opportunities to hear from outstanding resources but also from other companies that Enterprise Minnesota has worked with on a host of business challenges,” says Ron Kirscht, Donnelly’s president. “Healthy partnerships are the lifeblood of successful businesses. Companies cannot do everything for themselves, and their people cannot be fully and universally informed about what and who is out there. It is a test of leadership whether you are going to align your business with organizations and resources that can impel you forward, or if you are going to rely solely on yourself.”

“Companies cannot do everything for themselves, and their people cannot be fully and universally informed about what and who is out there. It is a test of leadership whether you are going to align your business with organizations and resources that can impel you forward, or if you are going to rely solely on yourself.”

—Ron Kirscht, president of Donnelly Custom Manufacturing

Measuring ROI and beyond

MEP’s well-documented results would be the envy of any company in any industry.

For every dollar of federal investment via MEP, the network created $29.50 in new sales growth for manufacturers and $31 in new client investment. That translates into $3.8 billion in new sales annually. For every $1,065 of federal investment, the MEP network creates or retains one manufacturing job. That’s a sky-high return for taxpayers.

In Minnesota, Enterprise Minnesota has helped push nearly $696 million in sales growth and retention for Minnesota manufacturers, has seen $131 million in cost savings, and has helped create or retain 6,650 jobs in the last five years alone.

“We measure everything we do,” Kill says. Each Enterprise Minnesota client participates in an independent, confidential

survey that assesses whether jobs were retained, sales grew, or money was saved.

The longevity of the MEP partnerships is a testament to the need for quality training and services specific to small and mid-sized manufacturers. MEP’s Schmit says he enjoys seeing companies provide data that articulate how an MEP Center contributes to their success.

Boulay of IMEC finds success stories to be as meaningful as statistics. “The stories of ‘this wouldn’t have happened without IMEC or MEP’ are really invaluable,” he says. Once, while giving legislative leaders a tour of a manufacturing facility, Boulay met an employee who had previously gone through IMEC training. “He still had the certificate on his workstation, and he talked about his ability to change jobs because he had improved his skill set. These are the stories that complement the numbers and make the training meaningful and impactful.”

Kirscht of Donnelly echoed the fact that it can be hard to quantify what it means to work with a partner like Enterprise Minnesota. “We’ve continuously added to the economic vitality of west central Minnesota for almost 35 years,” he says. Donnelly’s annual revenues today approach $38 million, it employs more than 225 people and contributes to the success of its suppliers and customers. “Without the timely help and vital support we’ve received from Enterprise Minnesota, I just don’t think we would have gained traction,” he says. “[Enterprise Minnesota] can help you get further faster and convert your very real challenges into transformative opportunities.”

Partnerships for the future

Past success doesn’t guarantee future results, and both Enterprise Minnesota and MEP are continually planning to ensure they bring the most relevant, world-class resources to manufacturers to help them grow and compete globally.

Kill predicts the demand for continuous improvement programs and ISO management will continue to grow. “Talent development is another big one, as so many companies face worker shortages that inhibit growth,” he says. “Strategic planning services will also grow rapidly, as even small employers realize the value of strategic planning.”

Kill also says that small manufacturers understand the need to address the emerging challenges related to cybersecurity.

“Cybersecurity can affect anyone,” he says. “Manufacturers have lots of vital information and need to have good controls around their information. They also need to protect their data and intellectual property.

The problem is that most assessments and tools are too complex for smaller companies, so we’re working with MEP to shape those resources for smaller organizations.”

Though the needs and programs shift with the times, the strength of the partnership between Enterprise Minnesota and MEP hasn’t wavered. “This partnership is resilient, and it’s a testament to our ability to know what’s happening and what’s driving businesses, to help companies grow and thrive,” Schmit says.

Del Conte emphasizes that success isn’t always immediate, but it’s the long-term, strategic direction of a company that will benefit a community for years to come.

That’s what makes the impact of MEP Centers go far beyond an individual company. “If we get manufacturers sustainable and moving toward future technologies, that puts them on a path of growth and innovation,” she says. “In a few years, they’re going to give you the biggest productivity gain. That [type of success] might not be measured in numbers of new jobs or new sales, but I’m most proud of the manufacturers we’ve helped get on a transformational path.”

The partnership between MEP, Enterprise Minnesota and other state Centers defines the best of a public-private partnership, helping companies from Pequot Tool and Donnelly in Minnesota to others in Illinois, Connecticut and beyond be competitive in a global economy. “The MEP network will continue to be an important partner for companies looking to evolve and stay competitive,” Kill says.

“It delivers resources and expertise that these organizations couldn’t necessarily secure on their own, and it supports these essential companies that are not only critical to the larger U.S. manufacturing industry but to the very existence of local economies.”

FALL 2019 ENTERPRISE MINNESOTA /

31

The Interview

The

Process of

Planning

Ridgewater College President Craig Johnson used a manufacturing consultant to plot the school’s strategic future while healing its acrimonious past

32

/ ENTERPRISE MINNESOTA

FALL 2019

W

hen Craig Johnson accepted his appointment to become president of Ridgewater College in April 2018, he knew he had to combine the skills of an administrative executive and a politician. And in this particular case, his skillset might also have to include that of a therapist.

Johnson arrived with a portfolio of 30-plus years of relevant experience. An art history student, he earned an Ed.D. in higher education from the University of Minnesota. He gained executive-level experience at the University of Minnesota’s College of Architecture & Landscape Architecture, Moraine Park Technical College, Winona State University-Rochester and most recently as executive director at the University Center-South Dakota Public Universities & Research Center.

Johnson’s new role would involve overseeing a public community and technical college where 4,500 students studied on two campuses—one located in Willmar and another in Hutchinson, about an hour east.

He would have to operate under the same constraints that the presidents of Minnesota State’s other 36 colleges and universities face. Strict caps imposed by the legislature controlled the revenue side of his budget, and the spending side was dominated by contracts that the state system negotiated, over which he would have little influence.

Closer to home, his school would have to accommodate demographic shifts in the numbers and makeup of upcoming student populations. Analysts were predicting a sharp drop in the number of high school graduates over the coming decade, and the cultural composition of those upcoming classes would change as well. Nearly two-thirds of the students in Willmar’s public school system, for example, are minority students.

He’d hear the clamor from local employers, especially manufacturers, about the urgent need for Ridgewater to churn out more graduates with specialized skills. They also would likely be looking for more informal and nontraditional kinds of training.

Plus, he’d still have to fight to reverse the stubborn stigma against community colleges believed by parents and high school educators and counselors: that a four-year college track is the only pathway to a satisfying and well-paying career.

Wait a minute, you ask, he wanted this job?

Hold on. There’s more.

Like college presidents everywhere, Johnson would have to contend with the sometimes-competing demands from powerful unions. However, Johnson’s new purview would be even more complicated than that. He was inheriting a workplace environment that had become higher ed’s version of the Hatfields and McCoys. His most urgent challenge was to heal a large and ugly rupture between Ridgewater’s faculty union and Douglas Allen, Johnson’s predecessor. The faculty union had become bitter and demoralized over what

Johnson was inheriting a workplace environment that had become higher ed’s version of the Hatfields and McCoys.

Bitter and demoralized over what it considered the previous president’s heavy-handed and autocratic management style, the faculty had overwhelmingly passed a vote of no confidence against the outgoing president and had refused to participate in Faculty Shared Governance. it considered Allen’s heavy-handed and autocratic management style, according to Mary Gruis, the school’s faculty union president. The faculty had overwhelmingly passed a vote of no confidence against Allen and had refused to participate in Faculty Shared Governance.

Johnson decided to use the process of creating a system-required strategic plan to help address this environment. To facilitate that process, he stepped out of the typical academic planning process and recruited Steve Haarstad and Patrice O’Malley, two veteran consultants from Enterprise Minnesota, who traditionally work with manufacturing executives. The two worked under the guidance of Ellen Roster, Ridgewater’s

executive director of institutional planning and effectiveness.

Describe your path to Ridgewater.

My focus early on was pursuing my interests, art and art history, not on being a president of an institution or a community college. But I did have some strong mentors at the U of M who gave me reason to think more seriously about administrative studies and moving into administrative roles. Many of our presidents typically come up through the academic ranks, but I didn’t. Mine was more of a generalist path.

What attracted you to this position?

I have come to love and respect the mission, the open access, and the boots-on-theground nature of the comprehensive community college. Ridgewater just resonated with me. I was interested in the structure of the state system, and the respect for education that we have, and of course the people here, the region, and the geography.

You walked into an organization that had experienced a good deal of internal tumult, especially between the faculty and the previous administration. Why was it broken?

I wouldn’t say it was broken. Maybe it’s semantics, but I’d say it was fractured or troubled. There had definitely been a building tension and point-of-conflict that came to a boil. Part of my role was to connect as soon as possible with leadership in the college, especially in the faculty, and get a sense of how I might contribute to re-establishing a foundation for a healthier dynamic—find out what was missing, what was wrong, and what needed to be different.

What did you discover?

Communication seemed to have broken down on everybody’s part. If you stop talking to each other, you’ll stop hearing each other; the more you start thinking something’s wrong or missing, the more you might look for it and find it’s actually missing. I had to make sure that as an administration, we showed that we are truly listening. I heard a lot about transparency.

People wanted decisions to be explained and justified. They wanted input and consideration about decisions before they were finalized. And that fits me just fine. In my career, I gather as much information as I can, make a decision, test the decision with FALL 2019 ENTERPRISE MINNESOTA /

33

Ellen Roster, Ridgewater’s executive director of institutional planning and effectiveness, oversaw the planning process. “It was a very relaxed environment,” she says. “There was a level of engagement and excitement that said, ‘Okay, here we go. We’re going to make something happen here.’ In higher education, you look around the room, and you know you’re never the smartest person in the room. That’s why I love it. You share this creativity, and it’s really a fun place to be.”

the people who are going to be impacted by it, and then make the ultimate decision and go and work with it. And if you’re wrong, you have to be willing to say you were wrong and take a step back.

Was it acrimonious?

I half expected to come into a very challenging situation. What I found instead was a group people who were surprisingly open, who didn’t want to go down that road again. They really wanted to find a way to rebuild what’s here. I think that also fit my skill set. A lot of my jobs have been, in one form or another, rebuilding or redesigning roles.

Did you use a strategic plan to start rebuilding?

People often joke that I don’t do much with my art and art history background. I disagree. My art history training gave me a respect for paying attention to what went on before and how that influences what we do now and in the future. My natural instincts as an artist give me a sense of how design is behind so much of what we’re doing as a college. We’re doing a reorganization, but it’s also a redesign.

I believe in windows of opportunity.

The chance for a new president to create a new strategic plan on the heels of a rather dramatic point in the evolution of the college was very timely. I learned at the College of Architecture & Landscape Architecture that when someone designs a building, the process isn’t just to produce the building, but to understand how that building fits into our goals, our culture, and what we want to be in the future. I saw it as a great opportunity for the college to examine who we are and who we need to be, and then have this plan reflect that. So, I saw the plan process as important as the plan itself. It gave us a way to reestablish dialogue and communication, to get people working together again. And I think that happened.

Using manufacturing consultants to facilitate your process has to be considered creative thinking.

I like to do things differently. And I think 34

/ ENTERPRISE MINNESOTA

FALL 2019

it fits our mission here. We’re a comprehensive community college, with growing pressure on us, appropriately, about workforce issues. We have many, many people who have been here 20 years plus.

They know what we do, they know what we’ve been, and they have a good sense of where we’re going, so I thought we needed something new in the mix. And trust was a big issue, so instead of doing it all internally, let’s get somebody who’s completely outside the box of higher ed to make sure we’re trying to see things differently.

Did it work?

The consultants developed a great deal of trust through how they did the work, how they came across, and the questions they asked. I don’t know if we would have been able to get that same level of confidence if we had done it ourselves or if it had been primarily weighted by college control. We made a genuine effort to build this from every faction of the college at every level.

Manufacturing executives might be surprised by the number of constituencies you had to include.

We did it by talking to some groups on their own and some one-on-one between administration and the consultants. But we also had different factions together at the table. Because we went back and forth several times, I’ve heard little, if any, criticism that people didn’t have a voice in the process. Will you inevitably miss something? Certainly. But we made every

effort to be inclusive, which was important for the college as a whole, and it was important for the plan.

How did you describe the endgame to planning participants?

We described the process more than the endgame. We asked what we wanted to accomplish and what process should get us there. About 80 percent of the way through, after we had gathered all the information, (Enterprise Minnesota’s) Steve Haarstad facilitated a critical meeting with the leadership group. And we invited faculty representation to go through some of the core issues that we had distilled from all these conversations. From there, we identified our key targets.

We identified five initiatives, the most important one being financial sustainability.

How do we make this something that we know can last? We have a model, our revenue and a budget—and all that is practical and realistic. Then there are the actions, the strategic areas we’ll focus on. Success with those areas will improve our financial footing so that we know we will have a viable operation.

What are those areas?

We came up with one key differencemaker: increased engagement, both externally and internally. That was the primary driver of everything else.

The second “aha” moment was that the real key target of everything we’re doing is financial sustainability, not just increased

enrollment. Increased engagement and the financial sustainability or financial viability piece became two of the five initiatives.

We realized we need to really focus on increased engagement internally and externally, and that will lead us toward the goal of financial sustainability.

In between, we identified three others: challenge the status quo; address diversity, equity and inclusion; and create a distinctive Ridgewater experience. But the driver remained increased engagement. We have to do more to have greater partnerships, improve dialogue, have greater buy-in and support, and have everybody on the same page.

Describe how to challenge the status quo.

It started out with being more about transformation, reinvention and innovation.

Challenging the status quo means critiquing what we do, how we do it and why we do it. We may keep doing certain things because they’re good. But it may also mean that we throw out or improve other things.

What about addressing the needs of nontraditional students?

A couple of things come to mind. One will be based in delivery. There are different needs and different interests regarding how people will access education. It’s not one size fits all. It’s about how we effectively and sustainably deliver enough versions of something to meet all of the interests out there. The smaller you are, the harder that is to do. A bigger college can probably do more of that variability.

A second consideration is communication. It’s not the same for every group.

A third is the support side, whether it’s co-curricular, extracurricular, or support services. Our challenge is to understand our current and trending populations. It’s not the same as 20 years ago. We might find a population that we just can’t serve if it’s too small, or it’s too expensive, or there isn’t enough demand out there. It all means we’ll probably have to make some tough decisions about financial sustainability. We can’t do everything, and we’re likely going to have to drop some things.

How much of your challenge is population?

It’s a consideration, but I think it almost gets too much weight. We will face our demographic challenge around 2025 when high school graduation numbers will drop significantly. We’re not at that point, yet.

But we need to start thinking about how to get more nimble, because we know there will be a point five, six years from now when attracting traditional age students

right out of high school will be tough.

I think our greatest challenge is the status quo. It’s about how we may need to change things that have worked well for decades, but may not be working well right now. We can’t only look at numbers and population groups and such.

What about diversity demographics?

They’re booming here in Willmar, and we need to do more to address that new population. For example, I think we’re around one-quarter of a diverse population in Willmar, but we’re 18 percent in terms of our numbers here at Ridgewater.

We’re nowhere near the numbers that are coming through the schools. The schools, I believe, are almost two-thirds of minority populations. We know we have to pay more attention to recruitment and communication and engagement—and we have to be welcoming and support many of those students of color who are coming to us as new Americans.

How are you addressing workforce issues?

I think employers are changing their view of where education and training fit into their hires. Our business of providing an education that leads to a credential doesn’t have as much value as it used to have—employers are more inclined to think about a potential employee beyond what education credential he or she has. We may need to do more non-credit training.

In the midst of it all, you have the whole debate about debt and cost, and what’s the ROI on going to college. We’re in the middle and it’s swirling around us. I think we have to make better sense of that.

What do you say to manufacturers who are continually frustrated by the fouryear-track mentality that comes out of high schools?

It’s absolutely real. We often talk about how many of us who are concerned about it have kids going to get four-year degrees.

There needs to be a merging of the two options. For example, there’s a small—but I think slowly growing—population that will get a four-year degree and then get technical training to customize that four-year degree to fit a career path.

And what about the stigma about community college?

We still are not at a point where people understand the value and the quality of a community college education as a way to get a lower credential that can really do more for you than you think, or it can give you a low-cost way to get ready to go get your four-year degree. We have changed

so much, but the public still has an oldfashioned perception of us. Students get a solid foundation from every one of our two-year colleges in the Minnesota State system. There is data that shows the people who finish a two-year liberal arts degree with us and go on to get a four-year degree do as well or better than other transfer students because of the foundation they get in our smaller scale classrooms with highquality faculty. The only thing they might miss is the big campus experience. And I’m not going to dismiss that. That’s part of the enjoyment of college. That’s real. But if you’re looking more at your education and its value, people don’t understand the quality of what’s here and what it could do for them. That’s on us. We have to get that message out there. But we need employers, we need community leaders, we need alumni to help us do that.

We need better engagement with the public to help them really understand how they can use us. We are one of the major solutions to the whole issue of student debt.

Back to the plan. Are you happy with the end product?

I’m even happier with the process that got us there. I think it helped accomplish what I hoped it would. It gave us a gathering point. It helped bring people together to communicate and interact. It was a good way to demonstrate that we’re really trying to be inclusive and increase participation.

The plan won’t sit on the shelf for three years. We are actively developing our work plan for this upcoming year so that every key unit in the college will be required to look at those initiatives and identify one to three action items they’re going to do that will help move that plan forward. We expect to have year one be primarily focused on engagement. So, 12 months from now, we’ll be able to answer how we increased engagement to fit that first focus of the plan.

And then years two and three, we’ll put more focus on the other initiative pieces.

One of the consultants who helped with the planning process has said he was more than impressed with the commitment of everyone involved at improving the student experience.

I agree. People in our industry come to work because of the students. They come for the love of teaching, to change lives, and to help people discover themselves.

And this college especially has a long history, and a well-deserved history, of absolutely wanting to help students succeed here. It’s embodied in every meeting we have, and it was present in the discussions producing our plan.

FALL 2019 ENTERPRISE MINNESOTA /

35

What Skills Gap?

Erik Hokuf

CASTLES in

SKY

the 36

/ ENTERPRISE MINNESOTA

FALL 2019

By restoring and building vintage WWII aircraft, Bemidji’s AirCorps has built a prosperous niche company with local talent

By Sue Bruns

rebuilds vintage World War II aircraft.

In the past few years, the company has caught the attention of WWII airplane enthusiasts across the country and internationally with its award-winning restorations: a P-51D “Twilight Tear”; a Stearman N2S-1; a P-51D “Sierra Sue II”; a Harvard Mark IV 405 (flown by President George H. W. Bush as a cadet in the navy); and “Lope’s Hope 3rd,” a P-51C. (Visit the company’s website for great pictures and project descriptions.)

As one of about a dozen companies in the country that does airplane restorations, Hokuf says AirCorps Aviation has two major projects and many smaller projects in process and at least three other restorations in the queue. “There are so many things in the pipeline that if we cleared everything away, there would be three or four more things moving in right away. But things will fall off if customers have to wait too long.”

So, AirCorps is diversifying and expanding, with hopes of more than doubling its workforce within the next half-decade. “Our challenge is, how can we turn an eight-year restoration into a three-year restoration?”

GETTING TO THIS POINT

W

hen he was 10 years old, Erik Hokuf knew what he wanted to do. “All I could think about was building airplanes.” By the time he was 17, he was learning airplane mechanics at Bemidji Aviation through an on-the-job training program offered by Bemidji High School. Instead of heading off to college after graduation, Hokuf continued to work for Bemidji Aviation, while simultaneously learning everything he needed to get his Airframe and Powerplant (A&P) license.

Fast forward two decades, and Hokuf is now general manager of AirCorps Aviation in Bemidji, a company that restores and Sue Bruns is a retired high school English teacher in Bemidji. Erik Hokuf was one of her students.

Hokuf’s career path from high school to starting a restoration company was a series of opportunities with bosses who, as he describes it, “gave me enough rope to run with.” After earning his A&P license, he moved to Minneapolis and accepted a job at Flying Cloud Airport where he worked on a variety of planes—new and old. While there, Hokuf heard about Ron Fagen, a collector of vintage airplanes. Fagen had a construction business that built everything from tool sheds to grain bins and eventually ethanol plants, but his passion was WWII planes and aviation.

“I started working for Fagen in 2003,” Hokuf recalls, “and I helped him start a restoration shop. He had just purchased a project, a combat veteran P-51D ‘Twilight Tear.’ I started working on the project and it won a Grand Championship at the EAA’s (Experimental Aircraft Association) airshow in Oshkosh, Wisconsin.”

Meanwhile, three other airplane enthusiasts—Dan Matejcek, Eric Trueblood, and Mark Tisler—were also employed in airplane restoration at Tri-State Aviation in

Wahpeton, North Dakota. After starting his own company in 2008 and freelancing and consulting, Hokuf invited the three to buy into AirCorps and form a partnership.

“Our partnership,” Hokuf says, “has allowed us to grow as quickly and as well as we have because we all bring different things to the table.”

Dan Matejcek, AirCorps’ VP of fabrication, grew up on a farm south of Wahpeton. He attended college in Wahpeton for machine tooling and restored airplanes at Tri-State until March 2011. Says Hokuf, “Dan can look at a part and tell you exactly how to make it.”

Tisler, VP of restoration for AirCorps, grew up on a small farm in western Washington. He earned his private pilot’s license

Erik Hokuf had faith in Bemidji as a place where great things could happen. in 1985, graduated with a B.S. in agricultural mechanization from Washington State University in 1987, and moved to Fargo, North Dakota to get his A&P license. Like Matejcek, he connected with Gerry Beck of Tri-State and worked there restoring WWII aircraft until 2011. While with Tri-State, Tisler worked on the restoration of a Corsair, TBM, T6, Sea Fury, and nine P-51s, along with many other aircraft and parts. “He can rattle off any detail in any manual,” Hokuf says.

Trueblood, AirCorps’ senior VP of sales and marketing, also gained experience at Tri-State. Growing up in Minot, North Dakota, home to the Flying Legends Warbird Collection, his interest in planes and aviation started early. For Trueblood, a graduate of the University of North Dakota College of Business, AirCorps is more than a business. His most memorable experience from the past few years is helping with the excavation of a P-47 Thunderbolt in Italy.

With three experienced restoration people on his team, Hokuf thought about the way Fagen had based his companies out of the little town of Granite Falls. “Ron started his business from nothing and chose to keep it in this small community of 2,500 people. At one time, he had over 2,000 emFALL 2019 ENTERPRISE MINNESOTA /

37

ployees in construction, working all around the country. Ron and [his wife] Diane are believers in keeping things local. Ron was good about trusting, finding local people.

It’s all about working with people.”

Hokuf had faith in Bemidji as a place where great things could happen. In 2011, AirCorps Aviation opened shop in the Industrial Park on the south end of town.

GROWING THE BUSINESS

In addition to doing restorations, AirCorps Aviation makes and sells parts for vintage and new airplanes. “Prior to WWII,” Hokuf explains, “airplanes were made almost entirely out of wood and fabric. Just before the war, they designed a new method of making planes out of aluminum and metal, and during WWII, they perfected it. An airplane made out of metals today is

made using the same methods of construction. Seventy-five years ago, breakthroughs happened in aircraft engineering design.

Many of the arts of that construction have been lost, so aircraft manufacturers and people who need parts look at us and ask, ‘Who made that?’ And we answer, ‘We made that.’ And then they say, ‘Well, we have a part that looks just like that, and we haven’t figured out how to make it. Can you make that part for us?’ That’s how we started making parts for other aircraft.”

Today, parts manufacturing accounts for about 15 percent to 20 percent of AirCorps Aviation’s business. “We’d like to continue to make parts,” Hokuf says. “There’s so much opportunity.”

38

/ ENTERPRISE MINNESOTA FALL 2019

AirCorps is also working toward becoming certified as an FAA (Federal Aviation Administration) Repair Station.

“As a certified mechanic in the U.S., you can fix something, but you can only sign your name to it. With that, it can’t be used on every type of airplane—like airlines and planes that haul people commercially.” The repair station certification involves writing a manual and getting it approved by the FAA. “We’re just days away from that,” Hokuf says. Once AirCorps is certified, its repaired parts will be usable on any aircraft anywhere, and the parts can go into other countries more easily.

“We’ve already done that on the manufacturing side,” Hokuf says. “We have Parts Manufactured Approval from the FAA for our manufactured parts. And then we sell them.”

IT’S ALL ABOUT PEOPLE

Growing and diversifying the company means growing the workforce. Hokuf and Trueblood know that AirCorps Aviation offers unique opportunities for employees, and one of their goals is to cultivate an atmosphere that provides satisfying work, a comfortable environment, and opportunities to use, transfer, and expand one’s skills to meet new needs.

“We hope everyone we bring on board will retire with us,” Hokuf says. “It doesn’t

always work out, but that’s the intent. We don’t want to lose good people.” He’s convinced that the area is filled with qualified people and hopes to draw them into the company. “Customers will come no matter where we are,” he says, but bringing in the right workers is key. Hokuf believes that some people lack the confidence in their own skills to realize that they could work for a company like AirCorps.

He cites three employees whose career paths weren’t direct lines to AirCorps but whose skills and core values exemplify what the company is looking for.

“We hope everyone we bring on board will retire with us,” Hokuf says. “It doesn’t always work out, but that’s the intent.”

Randy Kraft, a restoration specialist, has worked at AirCorps for almost six years. A huge picture of “Lope’s Hope 3rd,” his first airplane restoration project, hangs in the entryway. It won the Grand Champion award at the 2018 EAA AirVenture show in Oshkosh, Wisconsin.

“Randy walked in the door when we were finishing up the previous restoration (‘Sierra Sue II’), and somehow he ended up shooting rivets that were very critical and easy to mess up,” Hokuf recalls.

“He just hopped on and did a perfect job. I think he’s put himself into a career he never would’ve thought of, but he found this position and this niche that he’s really good at.”

After graduating from Bemidji High School with Hokuf in 1997, Kraft tried college. “I had dreams of working for Disney or Lucas Films,” Kraft says, and he enrolled in Bemidji State’s top-notch model building classes, but he just wasn’t into school at the time. Eager to make some money and escape from his hometown for a while, he worked for a large construction company in the Twin Cities for two and a half years before moving back to Bemidji, where he continued to work in construction for about seven years.

When someone told him about AirCorps, he thought, “I’m good at building stuff. Maybe I’ll just go build airplanes.”

He talked to Hokuf and took a tour of the company. He then handed in a resume and got the job. Kraft does sheet metal work and fabrication and is currently working on

“Much of what we make has already been designed—75 years ago,” Steve Wold says. “A lot of it is me reading a drawing from the 1940s and translating it into a 3D CAD model. The guys in the shop use all computer-operated machines now, so they need digital files. Obviously, you can’t put a hand-drawn 2D print from the ’40s into the machine; it has to be a digital file.”

the wings of a P-47 Thunderbolt. With his experience in construction, he brought critical thinking skills to this job and familiarity with reading blueprints. He appreciates the uniqueness of what he’s doing.

“There are 30,000 parts on a P-47.

Nobody’s built one from scratch like this since before the war,” he says. “I’ve learned a lot since I’ve worked here.”

CAD Designer Steve Wold brought a passion for airplanes with him, but, like Kraft, his path to AirCorps was, at best, indirect. Wold grew up in Moorhead and graduated from Moorhead State in 1997 with a degree in fine arts, drawing and illustration. He moved to Colorado to mountain bike and snowboard and had planned to work at a ski resort, but some metal sculpture work he had dabbled with in college led him to apply for a “will train” welding job. He ended up working 17 years for a variety of companies owned by the same family, including working as a design engineer for Diamond Spas, custom spas and hot tubs, all the time gaining experience using SOLIDWORKS—the same CAD program used at AirCorps.

After moving back to Minnesota and taking some time to enjoy ice fishing, he saw a job listing from AirCorps. “They needed a SOLIDWORKS guy,” he says, “and I thought, ‘Wow, that’s me!’” He’s been working for AirCorps since March 2015. Although he hadn’t set out to find a job in aviation, he says, “Aviation in my family goes way back. My dad was a pilot and had a plane when I was growing up.

We went to the Oshkosh air show every year.” Now he works at a place that wins awards there.

“Much of what we make has already been designed—75 years ago,” Wold

says. “A lot of it is me reading a drawing from the 1940s and translating it into a 3D CAD model. The guys in the shop use all computer-operated machines now, so they need digital files. Obviously, you can’t put a hand-drawn 2D print from the ’40s into the machine; it has to be a digital file.”

One of the least likely fits to an aviation company is Ester Aube. Originally from Montana, Aube was a cosmetologist for three years then took classes in museum studies in Santa Fe, New Mexico. While working at a museum there, she learned about another area of study that interested her: restoring historic paintings and documents. She moved to Delaware and graduated with a B.S. in art conservation. Aube then married a Bemidji guy and moved to the area, doubting she would be able to use her degree there.

When she presented at a Young Entrepreneurs’ Launchpad event, Hokuf and Trueblood were impressed, but they weren’t sure they could use her talents at AirCorps. But they ended up offering her some hours digitizing files for a project.

“We get engineering drawings for these airplanes on microfilm, and we digitize them,” Aube explains. “We take the files and rename them to the part number. Back in WWII, locating a file might take 20 minutes. Now, we’ve created a software program—essentially data entry for thousands of drawings—and we can locate files in a few seconds.” Sometimes her job takes her to museums across the country where she digitizes files that can’t leave the premises.

Then came the website. “We had so much information in the shop and no way to organize it. Eric [Trueblood] conceptualized what the website might look like, and then Erik [Hokuf] says, ‘Let’s do a

goodwill gesture to make this information available.’ That’s how it started.”

Restorers, researchers, model builders—anyone interested—can access all of the digitized files online. About a thousand members from 93 different countries subscribe to the site—and at a reasonable rate: $5/month or $50/year. It’s the only website of its kind where subscribers can actually see the entire files. Aube appreciates things like this happen at AirCorps.

“I’d never worked anywhere where you have an idea for something that you know is going to make things better, and your manager just says, ‘Let’s do it.’”

Now a full-time employee, Aube maintains the digitized library and the website, adding more files and assisting other workers in locating files. “My job is to help make everyone else’s job easier, better, faster. I never thought I’d be qualified to work in a job like this. It’s pretty awesome.”

GROWING THE WORKFORCE— THEY’RE OUT THERE

AirCorps Aviation currently employs 35 people and a few paid interns. “By far, our largest expense is our employees, but all but two live in Bemidji or the region,” Hokuf says. “Manufacturing brings money into the community. Money comes here and stays here.” And Bemidji has significant advantages. “Internet and the airport are huge game changers. We have unbelievably high-speed internet here.”

“We have so much potential in this community,” Hokuf adds. He says he is “penciling in plans” to significantly increase his staff in three to five years. “We have some things to accomplish before we can do that, but certainly the work is out there. To get there, we have to work on our organizational structure—building leadership in the middle. I’m not listening to the people who say, ‘Where are you going to find those people?’ We’ve already done it to this point; I believe they’re out there.”

They just need to find their way to AirCorps.

FALL 2019 ENTERPRISE MINNESOTA /

39

Final Word

In Search of ‘Aha’ Moments A new program will help show manufacturers the simple value of strategy

P

atrice O’Malley is understandably confounded by the number of manufacturing CEOs who, when asked to describe their commitment to strategic planning, metaphorically tap the side of their cranium and say, “It’s all up here.”

The source of her concern is that these are not isolated executives. Our most recent State of Manufacturing® survey discovered that: • Only 49 percent of manufacturing CEOs say their company uses a formal strategic plan for profitable growth.

That’s down four points from our 2018 survey.

• Thirty-two percent say that “strategy is strictly the role of the CEO.” • Sixteen percent say their company “has some ideas but has not yet worked through what our primary focus is.”

Just 28 percent say they operate from a one-to-three-year written plan and that “all staff know their roles and actions to achieve the plan.”

Patrice is one of the business growth consultants at Enterprise Minnesota who helps position manufacturers to manage current challenges and exploit future opportunities by rethinking and retooling their business strategies. She has a decades-long experience creating and implementing business strategies, most recently at Land O’Lakes.

“All companies have a plan of some sort,” she says, “but it’s quite disappointing that people don’t really spend time on intentional business planning.” The key to successful execution, she adds, can occur only when the whole organization adopts the plan. “And that has to do with inclusiveness and communication. If the CEO is the only responsible party to execute a strategy, you’re not going to get very far.”

Toward that end, Patrice is going to present one of our manufacturing workshops on strategy aimed at manufacturing executives from 9:30 a.m.-11:30 a.m., Tuesday, Sep40

/ ENTERPRISE MINNESOTA FALL 2019

Lynn Shelton is vice president of marketing at Enterprise Minnesota.

tember 24 in the Ballroom of the Tuscan Center in St. Cloud (3333 West Division Street). This event is open to manufacturers only. It is offered free of charge, but registration is required. In the workshop, Patrice will help executives answer the following questions: • Does your corporate vision include the right combination of strategic mission, values, and objectives to help your company compete and grow?

• Is your business effectively integrating your strategic vision into its existing organizational culture?

• Do you understand your competition or how technological advancements will impact your business?

• Are you incorporating your customers’ strategies into your strategic thinking?

• Do you know how to create distinct market advantages that will be difficult for competitors to copy or substitute?

“In my perspective, strategic planning is about working on the business, not neces-

sarily in the business,” Patrice says. “CEOs have to get better at dedicating time to focus on priorities that will help drive and achieve their business goals.”

Patrice hopes businesses will help debunk the common myth that creating strategy is a complicated, time-consuming process, or that strategy goes far beyond merely creating budgets.

Her focus during the workshop, she says, will be to help manufacturers “understand the importance of building and using intentional business strategies to create business value and make sure their ongoing strategic planning will enhance and protect the value of their companies.”

Patrice’s workshop will also introduce participants to a business tool that includes a live assessment of a mock-up company and the many pathways available to prioritize decision-making and engage the leadership team. Most important, she says, is that the tool breaks the strategic process into meaningful action plans.

Patrice says introducing a workable strategic planning process to manufacturers can be very satisfying. “It’s fun to see the light bulbs go on, when there’s an ‘aha’ moment.” It’s even better, she adds, “when the whole leadership team shares that same experience.” Those moments frequently occur during the execution of the plan.

“The approach at Enterprise Minnesota goes beyond helping manufacturers create a strategy that delivers their vision and goals.

We put a lot of emphasis on helping clients answer, ‘Okay, what’s next? How are you going to track progress against your plan?’

That’s when they get more comfortable with prioritization.”

Another benefit of these strategic discussions, according to Patrice, is that they lead to productive conversations. “People start to learn that they have more in common with each other than they might think,” which she says helps connect crossfunctional departments. “And, that gives manufacturers a lot more energy.”

9001:2015

Fifty-three percent of manufacturers say they have a formal strategic plan to achieve profitable growth.

Is your company one of them?

Call us today at 612-373-2900 or reach us at enterpriseminnesota.org for a free 90 minute consultation with one of our strategy experts.

We can help you grow profitably!

Scan here to learn more about how we can help your business.

2100 Summer St. NE, Suite 150 • Minneapolis, MN 55413

How does your building stack up?

Let’s take a look.

Facility Assessments Master Planning Mechanical and Electrical Upgrades Structural Enhancements Environmental Assessments Site Improvements Design for Renovation, Additions, and New Construction

Contact:

North

South

Central

Brent Dammann AIA 701.765.8005

Dana Hlebichuk AIA 507.206.2135

Greg Bohl AIA, LEED® AP 320.335.5009

WidsethSmithNolting.com