Enterprise Minnesota Magazine - June 2012
HELPING MANUFACTURERS GROW PROFITABLY
One year into Enterprise Minnesota’s Pathways to Business Growth training program, Absolute Quality is primed for growth with a new and expanded plant layout, UL certification and a recharged marketing plan.
In April, Congressman Keith Ellison was wide-eyed as he toured the Absolute Quality facility in Minneapolis, stopping to ask operators about the inner workings of machinery along the way. “I was struck by the efficiencies and innovations that were introduced,” he said in an interview following the tour.
Ellison has good reason to be impressed. For the past year, the custom wire harness, cable assembly and panel build manufacturer has undergone a complete transformation, from its layout to its certifications and marketing strategy.
Absolute Quality builds to the custom specifications of a multitude of customers across the nation, ranging from communications and electronic displays to agricultural, industrial, marine and utility. Its wires are behind the high-definition displays at Target Field, freeway amber alert signs and electronic billboards across the country. The company is an extension of Stark Electronics, which got its start in 1938 as a radio parts distribution business before making a series of transitions, from radios to television sets to battery packs and cable harnesses. Today, the two companies share a building and some overlapping employees, with Stark Electronics operating as the electronics distribution side of the business and Absolute Quality operating as the manufacturing side.
Last year, Absolute Quality was one of 10 companies selected to participate in Enterprise Minnesota’s Pathways to Business Growth program. The program is funded by a grant from National Institute of Standards and Technology (NIST) Manufacturing Extension Partnership (MEP) and deploys an array of training solutions to kick-start innovation and sustainable growth.
Absolute Quality first worked with Enterprise Minnesota to complete a companywide Value Stream Mapping (VSM) project, which helps pinpoint inefficiencies by mapping processes throughout the business.
VSM was an integral part of Absolute Quality’s recent expansion into a 15,000-square-foot section of its building which had previously been rented to a longtime tenant. Enterprise Minnesota Business Growth Advisor Mike Braml and Absolute Quality’s operations manager worked together to solicit layout ideas from employees in each department, then developed a layout to maximize the value of the new space.
Throughout the production floor, VSM has resulted in layout changes large and small, from point-of-use equipment storage and extra printers, copiers and email terminals, to a centralized receiving department and a new computerized system for tracking customer orders and production efficiency. President and General Manager Duane Petersen says the new layout requires employees to take 80 percent fewer steps, and has helped the company to avoid passing on recent cost increases to its customers.
Absolute Quality’s customer-oriented focus also extends to a new UL certification for wire re-spooling. Though UL listings are expensive, requiring fees, quarterly audits and the addition of an on-staff electrical engineer, Executive Vice President and Production Manager Jeff Zoubek says the benefits far outweigh the cost.
“Customers feel secure with the UL listing because they know you’re going through the right steps to manufacture that product to the level [of quality] that they need,” Zoubek explains.
To build upon its existing customer base, Absolute Quality’s next Pathways project was participation in Proactive Marketing training. Developed by Enterprise Minnesota last year, the three-month program helps companies to define and identify their ideal target markets, their competition, and how they can differentiate themselves from that competition to provide the greatest value to their customers. For Absolute Quality, the training has resulted in a brand-new website and a decision to pursue new customers and markets by bringing in four outside sales representatives from an independent organization—a move that proved more cost effective than bringing one salesperson on board.
Zoubek says the main challenge in instituting so many changes over the past year has been making the necessary time.
“To be able to change your company in the right direction and maintain your day-to-day operations without losing your mind is a lot. It’s like having two or more fulltime jobs,” he admits.
Petersen says a piece of advice from Enterprise Minnesota’s business advisers has guided their success: “[They told us to] ‘Delegate, delegate, delegate, and then delegate,’” he says with a laugh. “And that’s what we did. We were involved in every piece of it, but we would delegate and then have employees come back and report to us.”
More task delegation has allowed some Absolute Quality employees to rise through the ranks, as extra responsibilities allowed their talents to shine. In one case, a former inside salesperson has been promoted to operations manager. Petersen says hiring from within the existing workforce is ideal because employees are already familiar with the business and staff. It also shows a long-term commitment to employees.
“That’s one of the things that we’ve learned from Pathways: to look around within [your business] and talk to your people and see what they strive to do,” Petersen says.
Despite the challenges, Zoubek and Petersen are pleased with their Pathways successes to date, and are already looking forward to their next project: ISO certification.
“Everything that we discussed early on with Enterprise Minnesota regarding the goals that we wanted to reach has happened,” Zoubek says. “It’s really nice to see it all come together. Now we’ve got to go out and get the customers. It’s a great feeling.”
For more information about Absolute Quality Manufacturing Inc., visit www.absoluteq.com
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