Fast growth, creativity and innovation are core features of quickly growing and highly successful companies, and GenMet, a Mequon-based metal fabrication job shop, is no exception.
The company, purchased by Mary and Eric Isbister in 1999, grew from $3 million in sales that year to $12.5 million in 2008. While its sales slumped in 2009 and 2010, GenMet is on track now for record sales and revenues this year.
“Right now we’re on a trajectory to do $15 million (this year),” Mary Isbister said. “If I could hire as many people as I need, we could do $20 million, which would almost be a doubling of our revenue (from last year).”
While a percentage of the increased business is because its core customers have rebounded themselves, GenMet has diversified its customer base in recent years, expanding into alternative energy and related markets.
“We have a strategy to be as diversified as possible,” Isbister said. “The reality is that we make stuff for other people – the military, custom truck, POP displays, railroad and locomotive, and alternative energy.”
More importantly, the company used the economic downturn as an opportunity to get closer to some of its most important customers, Isbister said.
“We picked a couple of customers in (our business) segments and said those are customers we feel we can align our business practices and processes with,” she said. “We asked, ‘How can we demonstrate to them that we understand their business cycle well and demonstrate that we can support their business?'”
One way to get closer to their customers was to be even more transparent during the bidding process. Key customers are now invited to send a representative to GenMet, to sit with the company during the price quoting process.
“We share our costs and labor and show them what we want to make (in terms of profit),” Isbister said. “That truly is a partner type relationship.”
Isbister attributes a significant part of GenMet’s continued success to innovations and problem-solving solutions that its employees came up with. The company has fostered a culture of continued improvement by hiring people from non-manufacturing industries and through an internal idea submitting program.
“We have this ‘yellow sheet’ process. All suggestions are turned in on them and there’s a process of counting them, looking at them and evaluating them,” Isbister said. “The number of suggestions you submit are tracked, and people get feedback on their ideas. The innovator has to sign off them at the end (of the process). In your performance review, the number of them is recorded. That’s one way we judge and show their level of contribution.”
Employees are not directly compensated for individual ideas. Instead, GenMet uses a company-wide bonus pool to reward all employees for the company’s continued profitability.
“GenMet has paid bonuses every year we’ve had a profit,” Isbister said. “Some of them would get you lunch at McDonald’s, but some of them are thousands of dollars.”
GenMet’s use of lean manufacturing and continuous improvement has turned into close relationships with its suppliers, which often are required to make daily deliveries of raw materials.
“We get as close to single part blow-through that we can,” Isbister said. “They (our suppliers) have to know that if they work hard and be that good (100 percent quality) they’ll have our business. That’s part of the reason we can operate a $12 million business in the same facility.
“We don’t have inventory. It flies through what we call the highway. It’s about letting the guys who do the work make the process run. It’s about giving them a challenge of what we need them to do and giving them what they need to make it happen. It’s amazing.”
