I have been touring Pettibone Manufacturing in Baraga, Michigan, with Kevin Walsh, president of the company. This is part two of my report of that visit.
After we'd walked the length of the production lines,
we came back and poked into an office near the work floor. "This is Jerry Niemi," Kevin said. "He's our plant manager. He's been here for forty-three years."
Latendresse had started the company in a little garage in L'Anse, which burned. The business moved to Baraga, got bought by Pettibone, and in 1958 there was another fire at a different location in town. That plant burned to the ground. Jerry had photos of the aftermath in his desk - printed in the margin of the photo, "March 1958." They were old black and white photos starting to go grey the way old photos do, showing burned machines against a dusting of snow, stark black and white, looking a lot like the end of things. The company regrouped and rebuilt.
Why so many fires? "We did a lot of our own welding back then," Jerry said. "Those were wooden buildings."
What's Jerry's challenge managing the plant? "The toughest thing," he said, "is making sure it runs like a well-oiled machine. That everything is coming in as it's needed and the men have something to build."
The company currently ships thirty to forty machines per month, Kevin told me, "but we're picking up. We have the capacity to build sixty to eighty per month." To do that, of course, they'd need to put on more employees.
"That's our goal," Kevin said, "to employ a few more people. To improve the local economy. We feel a duty to grow the business to support the local economy, a personal mission to grow the town."
Jerry said he has seen a lot of changes over the years, improvements. "The most remarkable," he said, "was the institution of the production line." Before that, there were several "cells," each building a complete machine. This change was made in 2000. When they decided that was the direction to go, Jerry said, "I could hardly sleep, thinking about what we might do."
Pettibone calls its continuous improvement KAIZEN. "The idea is to get lean and reduce waste," Kevin said. "We're not perfect, we want to get better."
Was KAIZEN hard to sell to employees? I asked.
"It's a forum and a format for their ideas to be heard and incorporated into how we do things," Kevin said. "They see that things are more organized now, everything flows better."
"We ask them to think, rather than just come in and turn a wrench," Kevin said. "They LIKE to think."
Kevin said that during some paving around the factory, the employees had to go back to hanging booms the old way for a couple of days. "Boy, do I like the way we do it now," one of the fellows said afterwards.
"If the employees are frustrated, that's a sign that something is inefficient," Kevin said. "How can we reduce that inefficiency and waste and reduce the frustration?"
KAIZEN applies not only to the Pettibone plant, but to all the fabrication and machine shops that supply Pettibone's assembly lines. "We're partners," Kevin said, "we're in it together. We meet formally a couple times a year. Some suppliers are in here every day."
Jerry is originally from the area, but Kevin is a transplant from Washington, D.C. How did you get here, I asked him.
"I was just lucky," he said. "Banished to Baraga, Michigan, some say. No way. It's a gold mine we've got here. We shouldn't even tell you what a wonderful place it is, everyone will want to come and the place will change. Yesterday, as an example. On my way to work, a bear ran in front of the car. In the afternoon, an eagle circled over the plant."
Pettibone's business had slowed two or three years ago, Kevin said, first because the economy slowed down generally; and, secondly, because "this industry had significant overcapacity."
"There has been a huge consolidation in the industry," Kevin said. The four largest businesses in the industry consolidated and now own sixty percent of the market. "Don't give them any publicity."
Pettibone has "a little less than ten percent of the market," he said.
By way of example, Kevin point out that in 2000, 13,000 rough terrain forklifts were sold in the United States, by twenty manufacturers. Sales have been in the range of 7,000 per year the past couple years.
The reason for the overcapacity and the sudden decline in sales?
"Rental companies had to fill their pipelines with equipment when they started growing all over the world," Kevin said. Manufacturers who sold to rental companies had to increase production to keep pace with demand. Then, when the rental companies had all the equipment they needed, orders fell off.
"We don't sell to those rental companies," Kevin said. "We sell to dealers who take care of customers. We focus on customer service."
To be continued....
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