|Eyes on the Future at i2tech|
|by Dianna Brodine|
|Profile Winter 2011|
i2tech is hiring eight new employees. They’ve been in the building for 15 minutes, received a set of ear plugs and
safety glasses and have the monthly shift schedule in front of them on the table. In walks Bob Janeczko. He opens
his introduction by emphasizing the company’s safety record, justifiably proud of its recent celebration of one
million man hours worked without a lost time accident. The accomplishment comes from a basic belief that is at the
root of the company’s safety procedures. He tells the new recruits, “There is nothing in that shop – not a part, a
customer or a machine – that is worth getting hurt over. You are most important to us. You are most valuable to
50 Years in Plastics Molding
The 50-year history of i2tech is treasured, with pieces of its past pulled from maintenance toolboxes and off dusty shelves so they can be displayed prominently at the front of the building. Inside a display case, resting within a rusty metal box, is the Lazy Ike fishing lure. The Lazy Ike was one of the company’s original plastic parts, first molded in 1961, and Janeczko takes pride in showing it off. As the history lesson continues, Janeczko points out one of the first injection molding presses made by Cincinnati Milling Machine Co. (now Cincinnati Milacron). It was purchased in 1968 and still has the old ‘milling machine’ logo on the press. Janeczko tosses off bits of historical fact like a kid rattling off the stats of his favorite baseball player and you forget that this is not a family business passed down from one generation to another.
Five ownership teams have brought the company to its current silver anniversary. Bob, his wife Charllotte and son Josh, now president, purchased the facility in 2003. The wheels for that purchase were set in motion in 1998 when Mid Central was sold to Morton Industrial Group. At that time, Bob Janeczko was president of Morton’s metals division. Eventually, Morton came to own six plastics plants but the venture wasn’t entirely successful. Five of the six plants were bankrupt by 2002, and were sold to an outside company. The lone profitable facility was in West Des Moines.
Bob’s son, Josh, also was employed by Morton at the time as a Six Sigma black belt. He recalls a conversation at the dinner table: “Not knowing anything about buying a business, I said ‘Why don’t we look into buying the Iowa plant?’ The thought of owning a business with my father and having a partnership with him was appealing.”
Bob had spent a year at the West Des Moines facility while employed by Morton. He also had 14 years of experience in quality and supply management with John Deere Davenport Works. The West Des Moines plastic processor had made its first shipment to John Deere in 1971, so the relationship with a long-time customer would be able to continue uninterrupted. Bob Janeczko knew the employees. He knew the customers. The timing was right.
Today, i2tech runs four shifts, 24/7, with 156 employees. Customers include John Deere, Arctic Cat and Kawasaki Motors, and the facility produces more than 2,500 different parts made from 1,000 molds and over 280 different plastic resins. There are 27 injection molding presses, ranging from 40 tons to the Husky 3,000 ton, and 13 robots assist with production. Since 2003, the Janeczkos have invested more than $7.5 million in the plant and its equipment.
Sharing the Wealth
To encourage employee enthusiasm toward achieving the standards set forth by the quality policy, i2tech shares its profits through VIP. Every employee is vested immediately in the gain sharing program, through which each employee can earn up to nine percent of gross wages, including overtime. In January, all employees receive a copy of the monthly operating income goals for the year, printed along with the quality policy on a small card. These cards detail plastic sales, mold sales and operating income goals. Safety is addressed, with OSHA Incident Rate and Severity Rate goals, as are quality standards for i2tech’s individual customer lines, delivery performance and housekeeping scores. VIP is measured monthly (paid quarterly) and all employees receive the results each month at an all-employee meeting.
“We’re trying to engage every employee in the financials of the business,” explains Josh. “Profit, scrap, costs, direct/indirect labor – we want them to understand what drives the business and profitability.”
Bob chimes in, “The employees are making decisions 24/7. They need to understand the impact of those decisions. We set the goals and then set them up for empowerment.”
Empowerment pays off. Since 2003, the Janeczkos have paid out more than 1.4 million to all employees through VIP, with employees receiving the gain sharing in 63 of the past 88 months – a 72 percent payout rate. “We believe in sharing with our employees,” Bob tells the new employees beginning their training. “It makes you a better businessman.”
Easy Green Victories
Within the 113,000 sq. ft. facility, lighting has been installed that senses movement, switching off and saving energy when no one is in the plant. The lighting operates independently in the different sections of the building so that movement in one part – for instance, the warehouse – triggers only lighting in that area. This has yielded significant cost savings, while also reducing electricity usage.
Garbage was next on the agenda. Since all of i2tech’s waste is hauled away by the same company, it has been easy to measure improvement. The team began by establishing a six-month baseline, measuring the amount of waste being taken out of the facility. Then it focused its efforts on reducing that waste through recycling and reuse. i2tech has been able to reduce the number of times trash is picked up each month, resulting in cost savings since the garbage company is paid on a per visit basis.
Josh continued looking for the easy victories and the next target in his sight was reducing material waste. With nearly 300 resins on site, i2tech focused on keeping 90 percent of its resin purge from going into the landfill. The 10 percent of material that isn’t reutilized is the purge generated between material changes. i2tech also pledged to implement procedures from Operation Clean Sweep, a program launched by SPI and the Plastics Division of the American Chemistry Council to reduce pellet loss. “I was appalled at the amount of pellets being mishandled,” explains Josh. “We’ve got to do a better job. The programs we’ve put into place are cost-beneficial, but we also have a responsibility to support environmental efforts.”
Eyes on the Future
“I had wanted to fund a scholarship at Stout for quite a while, but we procrastinated,” says Charllotte. “Then Stout started a program in plastics and it seemed natural to endow a scholarship, because that’s how we’ve made our money.” The Janeczkos’ donation will eventually yield an endowment of over $1 million. Four students received partial scholarships for the 2010/2011 school year – a senior and three incoming freshman. In time, the scholarship fund will provide full funding for a student’s four-year education.
“We have to bring manufacturing back to this country,” Charllotte explains. “I also wanted Bob and me to be remembered, and the scholarship ensures both of those goals can be met.”
The same forward-looking philosophy applies to the succession plan at i2tech. When Bob and Josh purchased the West Des Moines facility, it was with the understanding that Bob would retire, selling the company to Josh. Bob’s retirement was set for 2010, but Bob isn’t quite ready to leave the business he loves and that date has been extended until 2015. “A family business has been a strategic advantage for us,” Bob says. “The employees like the security that it offers. The suppliers like knowing who they will be dealing with year after year. And the customers know that Josh will someday take over.”
As 2011 commences, i2tech is ready to charge into a successful new year. When the economy slowed, the company was fortunate to be in a good position in regards to debt. Thanks to its reputation, i2tech didn’t lose a single customer, even though it saw significant reductions in its agricultural and recreation lines. To make it through, adjustments had to be made. “We had to lay off direct labor and reduce fixed costs through salary furloughs,” explains Josh. “We went from a 183 to a 137 head count, which was back to 2003 employment levels.”
Still, the company remained steady overall. By the end of 2010, the agriculture market began to pick up again, although recreational products are still slow to show growth. i2tech has been bringing employees back and is now up to 156. The company’s focus is on maintaining good customers and taking on good risk. “The bottom line,” says Bob, “is we’ve been profitable for 30 consecutive quarters. We’ve been through cyclical times before and we know how to adjust to them.”
In the training room, Bob Janeczko leaves his new employees with one last thought. “Manufacturing is a tough business. You’re working 12-hour shifts, and you need to be in good physical and mental condition. It’s tough, but it’s fun! We’re going to work together so we can all make some money. And we’ll enjoy it because we know we’ve done it the right way.”