Built to Last | Episode 4: Growing in to the New Building

In the final episode of Built to Last – The Metalcraft Legacy Series, former CEO Steve Doerfler joins current CEO Kyle Bermel to reflect on the leadership, innovation, and long-term vision that continue to shape Metalcraft's future.

From building a culture of continuous improvement and investing in employee development to expanding RFID capabilities, launching ARK Business Systems and Inlay Innovation, and planning for leadership succession, Steve and Kyle discuss the decisions that position Metalcraft for its next 75 years.

As the series concludes, Steve shares what he's most proud of after more than four decades with the company and why he believes the true measure of leadership is leaving an organization stronger than you found it. More than a conversation about one career, Building the Future is a reflection on leadership, legacy, and the responsibility of preparing the next generation to succeed.

Built to Last – The Metalcraft Legacy Series is a four-part podcast celebrating Metalcraft's 75-year history. Through conversations with former and current company leaders, the series captures the stories, leadership lessons, innovations, and defining moments that have shaped Metalcraft since 1948—and the vision that will carry it into the future.

Learn more about Metalcraft: https://www.idplate.com

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•  LinkedIn: https://www.linkedin.com/company/metalcraft-inc/
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Transcript

SPEAKER_01 0:07

Welcome to the Metalcraft History Podcast. This is our fourth out of our four-part series. I'm here with Chairman and CEO Steve Dorfler, and today we're going to talk about the moving into the new business building and the succession plan. Steve, welcome.

SPEAKER_00 0:25

Thanks, Kyle. It's great to be in a little different chair where I'm not asking the questions. So hopefully I've got the right answers. Oh, you always have the right answers, boss.

SPEAKER_01 0:34

You've been with Metalcraft for 42 years, been associated with it, right? You know, tell me how you got there. How did it start?

SPEAKER_03 0:43

Kyle, that is, that's a great question because I was a manufacturer's rep in 1984. I left Caterpillar. I just, it was too big of a company. I wanted to do something that I would have a little bit more control over. So I became a manufacturer's rep. And Metalcraft was one of the companies that we represented. And I became uh enamored with the product line at that time. Barcode was becoming very popular. The company was excellent. I got to know Wally and Doug pretty well. And lo and behold, uh it was right around Thanksgiving of 89, out of the blue, uh Wally calls me and said, Hey, um, we'd like to have you be our sales manager. And I thought, are you serious? Uh yeah, we're very serious on this. And at first I said, uh, you know, Wally, I really appreciate it. I have a lot of respect for you, love the company. I'd rather continue to be a manufacturer's rep. Uh so you know, that's kind of where we left it. But then a couple weeks later, I'm thinking, okay, I've traveled of the last 10 years, I've traveled eight of those a lot. Jared was not even quite one. And I just envisioned myself of, okay, are you wanting to travel every other week or travel as much as you are? Sure. The this position, you're probably going to have to travel a little bit, but not near as much. So I just started thinking about it more. Came up to interview, um, was really impressed with the overall operation. I knew a lot about the company anyway. And one thing led to the other. It's kind of interesting because when Laura and I came up to interview, it was over Christmas of '89, and it was 40 below here with Winchell. And and uh Wally said, I I thought we lost you on that, but I was actually anxious because I love the winter sports. I was anxious to get back into the winter sports. I felt like this would be a really good environment to raise kids, um, and great company. But the key question was uh for Wally's I wanted ownership. I wanted the possibility of ownership. He didn't have to guarantee it, but I just wanted to know, is there a possibility of ownership? Uh and he confirmed that yes. Um as a matter of fact, we're we're we're looking at you know potentially buying out the Patton family. If that happens, there'll be an opportunity for that. Uh and so I was I was on from from that point on. Um I was the uh the sales manager for Metalcraft coming up here in February of 1990. And looking back, uh it's been a fantastic career. I'm glad I made that decision then.

SPEAKER_01 3:30

And so sales manager in 90, and that held through until becoming Yeah.

SPEAKER_03 3:37

Then I I was sales manager, but then I also had at that time we didn't call it marketing, we called it advertising. So I had advertising responsibilities. I became uh officially I became a VP of sales and marketing in 98. Um, and then when Doug and I had the had the buyout, then became president at that point at that point in time. But in 93, when when Wally and Doug really orchestrated the buyout of the Patton family, uh the good thing is Wally did not want uh to be 100% lock, stock, and barrel owner. He was he wanted to be a majority owner, but he was fine and set aside uh a block of shares for all the managers to to invest in. And he did that saying, okay, I'm gonna give you guys 93 and 94. Uh, but after those shares are gone, they're gone. And after 94, I'm only gonna allow maybe new people to come in, new new managers to come in. So um I certainly took advantage of as much as I could in '93 and '94 uh to invest in the company. And that's what really built uh built my portion of the ownership.

SPEAKER_01 4:49

I know that was a big part for me as well. Do you want to go into more detail and what that meant to you, that ownership piece?

SPEAKER_03 4:56

Yeah. Um I guess I was raised with that philosophy. My dad was always uh kind of a guy that wanted that independence or ownership, if you will. Uh I I was just enamored with being an owner, having a little bit more control over your destiny, if you will. And that was one of the things that as a manufacturer's rep that I started uh reasoning out that I really I may think I have control over my destiny, but in reality, at the whim, I could be cut off. I could uh I could lose the ability to sell for a particular company if they went a different route. So I really didn't control my destiny. Uh so I I ownership meant a lot to me and growing into that, just having a piece of of the pie and growing with that company.

SPEAKER_01 5:44

I know in the the previous podcasts we talked about the flood and we talked a little bit about or I heard I heard you guys talk a little bit about uh the new building. Right. So I'd like you to talk about what it really means uh to make an investment, control our own destiny, to make an investment uh like we did in the building that we're sitting in and how that impacts the community.

SPEAKER_03 6:08

Sure. Um you know, at the time we had the flood and and after we cleaned up, we thought, well, you know, maybe this building's okay. But then as we started growing with RFID, uh we became very constrained. And it let's face it, it was a three-story, three-story building. Uh we were bounding up and downstairs. Uh anybody, uh any industrial engineer will tell you that's it's a it's terrible flow to do that. And it was, you lose a lot of time. And so there's a couple of different reasons. One, we are running, we were running out of space. Uh we needed to be more productive. We needed to show our people that we want we're here to grow. Um, second of all, a safety issue. And we got people bounding up and down the stairs. Um, you know, that's a safety issue. Plus, we were so we are so jammed in that that's a safety issue of not having tripping over things because you're you're so compressed. Um, and that another component, which was really a key, is try recruiting in that old building. I had to recruit you. Uh you know, I brought you up, I convinced you to come up, and we were in the old building, but I painted this vision that, yeah, we're looking at this. Um yeah, recruiting in an old building like that is like, well, where's the vision here, fellas? Um, so we had to show that we had a vision on that. Uh and then the the last real component is that really put a little bit more pressure on us to say, okay, it's up to us to grow. Yeah. Uh because we have to grow. It's a big investment. It was an investment of about $4.2 million. But what it meant to the community is we're here. This is this is our home. We're we're going to stay private and we're going to stay local. So you have a good tax base. Uh, at the time when we made this, uh we made the move in, uh, we had um 71 people, and we we we received an incentive, uh essentially a 10-year tax abatement. But that was based on us growing into 81, which which we we did, we easily did, uh, quite frankly. So and then we we actually got a rebate per those those jobs of growing into that. So it worked out well for the city. Uh they have a nice tax base, they kept us local, but we also employ a lot of people uh economically. It's it's very good for them.

unknown 8:28

Yeah.

SPEAKER_01 8:29

Luckily on that recruiting visit, you didn't show me where my office was going to be, down in the basement. Well, why we I mean I thought that was pretty plush down there. I was the one going up and down the stairs.

SPEAKER_00 8:39

Yeah, I appreciate you putting the work in to get the new building.

SPEAKER_03 8:42

Trevor Burrus, Jr. Let's put it this way we mitigated the mold from the flood.

SPEAKER_02 8:45

So what can you know, why were you complaining? Yeah, the drywall was gone. That's right.

SPEAKER_01 8:50

It was halfway up. What are you talking about? That's what it's called the split. That's right.

SPEAKER_05 8:54

Yeah.

SPEAKER_01 8:55

With the RFID growth that you talked about, um, a lot of that came from uh uh one of the products that we worked on, uh the patented on-metal universal. You want to speak a little more about that, how that came about, who we worked with, and what it means to us?

SPEAKER_03 9:11

Trevor Burrus, Jr. Sure. It was interesting because as we were getting into the RFID uh space, um Baird Financial, uh RFID was so big that Baird Financial was tracking this industry. And once a year, and I think it was circa 2004, they started having these major annual meetings in Chicago. And Kyle, there there'd be there'd be well over 100 people that would attend these. These were suppliers, these are people, uh converters like us, it was everybody. And I started attending these things, uh, and I felt like uh uh literally a little fish in a very big pond. Because the first couple of years, I think it was about a three-year period, the three or four-year period, first couple of years, all they're talking about is retail and the you know, millions and billions of retail. And of course, our business is asset control. And I seriously, I was thinking, I'm wondering if we we just missed the mark because retail is in our business, the margins are lower, the volumes are much higher, we're not geared for that. Well, it was on the third year I went back, and now the shift was well, what about assets? What about equipment control? And it was a major shift. That gave me the confidence to say, we're we're we're playing in this uh correctly, but we don't have the product because all these assets, I mean, there's plastic, there's metal. We needed a product that will work on everything. Because at the time, like a barcode, it doesn't make any difference what you put it on, right? Uh but RFID, uh, it's not going to work really, the same product won't work on metal as it would on wood or or our polymer. So you need a truly a universal product. Uh I went to John Henry at that time, who's our RD manager. I said, we we need to try to solve, this is our goal. We need, and I dubbed it, we need a universal product that will go on all assets. So John did a really good job about engaging Iowa State. Um we went to their double, uh, their their electrical engineering department. A really sharp professor there got a student or two working on this thing. We went down there a couple of times, and lo and behold, they came came up with a solution for us that um we patented, but the iSurf, Iowa State Research Foundation, they had control over. But that we had um we had exclusivity over it. Uh it was ours, and that gave us the impetus to really grow that business until it represented well over a couple million uh uh dollars. And and we were the only ones that had that technology. But beside that, we figured out how to produce. It's one thing to to have the technology, but now you've got to figure out how to produce it, and we were able to produce it uh so we could uh uh make long production runs instead of just short production runs.

SPEAKER_01 12:09

That was a pivotal part in our history because we're still using that product design today, right? It's a big big deal. Yes, yeah.

SPEAKER_02 12:16

Yep.

SPEAKER_01 12:16

Thanks for sharing.

SPEAKER_02 12:17

Sure.

SPEAKER_01 12:18

On the uh staying on the product side.

SPEAKER_02 12:20

Okay.

SPEAKER_01 12:20

You know, I know in the previous podcast you guys talked about the autograph nameplate. Yeah. How we got our start, right? All of that. Correct, there's been some changes to that product line uh recently. You want to talk about you know the importance of those changes, why we would make a change in uh a leg a legacy product like that and the impact it has.

SPEAKER_03 12:40

Sure. Um Yeah, you know, our start, that that's how we were founded with that particular product line. And then uh with property control really coming into play in 52 and then really accelerating in 62, uh, that was a mainstay product line. But one of the things that we had some limitations was our print uh our our print capabilities. We first started with litho printing, which was a very, very slow process because you had to bake the colors, you had to put it through a transfer oven, uh, and that was 20 minutes for through the transfer oven for one color, and you had to do that for every color, uh, very slow. Then we went to screen print, which was good, but we had this one very large customer um where we would use four to five colors, and we'd have to trap those colors. Um, and and while we were good at it from a screen print process, it's a lot of time when you're putting down five colors. The beautiful thing about the Swiss Q that we we we were interested in is that we could do all those colors in one pass. Sure, it was a little bit slower because it was digital print, but when you combine printing each color, uh we were able to say, oh, we're gonna we're we're gonna be able to cut time on this. Um plus it's much fewer resources, a lot of robotics involved, uh just much more efficient. And then we were thinking about, well, what are the other colors or the other customers that we can use this for and give us an advantage on that? So it just made a lot of sense that we would uh make that legacy change into a different technology that affords us some greater opportunities to expand that business.

SPEAKER_01 14:29

I also like it too when I walk out at night and it's running and no one's there. I like the robot. I like the robot on the yeah, makes my job easier. That's yeah, yeah.

SPEAKER_03 14:38

And you can talk to it as well.

SPEAKER_02 14:40

That's right. The only problem is, yeah, it's tough to have a tough to have a dialogue with that, right?

SPEAKER_01 14:45

So you were very visionary with identifying the universal, right? That market, um, then the need for that product. Tell me a little bit more about how we looked at access control. We were always in access asset management. Yeah. What did uh what did that look like? How did it come about, and why'd we make that choice?

SPEAKER_03 15:06

Sure. Um and and and that's a great question because again, we didn't know really that much about access control. Uh and when you talk about access control, that's access of vehicles, people, uh, and that can be through parking where uh parking facilities, it can be car washes, it can be tollways, all of that. And uh a couple of key facets that were uh really interesting for us is volume. There was a lot of volume uh where assets could be you know maybe 5,000, 10,000 here. We're we're talking about tens of thousands of pieces here. And car washes, there's just a plethora of car washes now today. Uh so the the volume was was very intriguing on that. Uh second of all, for like uh for car washes, they wanted something that would be non-transferable from vehicle to vehicle. So, like me, I might get the idea of saying, okay, I'm kind of cheap. I'm gonna get one, and I'm gonna take it off and put it on the Laura's car, and we'll just transfer it back and forth, right? Well, they they wanted to minimize that. So we were able to design destructible slits into that where you could not easily do that. It would actually tamper the inlay and make it uh make it non-usable from that standpoint. So we could do that. Uh another I and another portion of that was they all had very unique logos and they liked a lot of graphics, and some wanted a single part, some wanted a two-part. So the whole engineering capability of that, along with the logos, just fit very well with the four-color process printing that we had with the indigo. And then the high speed of placing those inlays with the with the predator, the high speed and being able to read, write, and program those, all of those just added up uh as a great opportunity for us to expand from from assets.

SPEAKER_01 17:04

Talk about another expansion. Um You know, we were in RFID, and then I think we started seeing some some opportunities go away or that we were missing out on, right? Right. So um I think we brought about Arc Business Systems, and uh that was a big move for Metalcraft, right? You want to talk a little bit more about what that meant to Metalcraft, how we got into it.

SPEAKER_03 17:31

Um Yeah, I I'm I'm happy to do that. And I also want to get some of your perspective because uh you were highly involved in that. I in fact it it really came about for for a couple of different reasons. One, uh we would we would generate a lot of leads, and a lot of these leads were for smaller volumes, um, you know, maybe maybe they only needed 5,000, 10,000 assets. And we would feed those to various integrators. And what we were finding is you know, we'd be following up, well, where is this project? Well, it it died a natural death because of the integrator was too small. And so not only were we losing out on the tag business, but it was okay, we're losing out of the tag business, but maybe there's an opportunity for us to solve that customer's need for some kind of an asset control system because the integrators, it was just too small, they weren't they weren't paying attention to them. Well, uh, you know, circa 2014, I remember you coming to me, uh, and maybe we'll talk about this a little bit later, but you came to me with this idea of of creating an innovation team. Uh, and to me, it was oh, I was excited about it because you had mapped it all out and you wanted approval to do that. Well, anytime somebody comes to me with an idea like that and talks about innovation and what we can do, I was all in. To me, it was, I'm gonna let you run with this. Well, that's where the idea from art came from, the innovation team. And the idea was we can create a product there to track, and it's for smaller to medium-sized customers. It wasn't for the big ones, it was an out-of-the-box solution where they have the software, they have the reading mechanism, and of course, we provide the labels. So it was a one-stop shop for our customers. Um, so that's really how ARC uh started on there. I'd kind of like to know your perspective from from your standpoint of just how that transpired as well from that innovation team.

SPEAKER_01 19:32

Yeah, and thanks for thanks for allowing us to do the innovation team. That meant a lot. Um, I know that we had we had a great team, still do have a great team on the innovation team, but we just really had fun together too. And we we we were able to challenge the status quo. So that was always that was always a good time to get into those meetings and really just uh just think outside the box and look for something new. And that's really where um the art came from. Um our our first product, Great Trunk RFID, came out of that. And it wasn't uh accepted right away, if you remember.

SPEAKER_03 20:02

Oh, I do remember that. I you know, I figured uh I wasn't gonna bring that up until until you brought that up.

SPEAKER_01 20:07

Yeah. So we had to go back to the drawing board a couple times, um, but all from really good feedback from the leadership team, and and they never they never slammed the door on it, which was um very important um because we wouldn't be where we are today without that. So um it was it was uh it was definitely a learning process. Um still overshot the numbers a little bit. We may have may have overshot the numbers a little bit, but uh it's been continuing to add value to our customers, it's been very important uh for our both our tag sales business and our services side.

SPEAKER_03 20:40

So yeah, I think it's one of those those decisions that is I would say is pivotal in in the history of the company. And not so much from uh from what the revenue was generated then and even now. But it's mainly to it's mainly to say to our our members, but also to our customers this is who we are, and we're you know, we're transcending into a different into a different company, and we can provide these value solutions. And I'm I'm excited to where this is gonna go. I I really am because I think there's a huge opportunity after uh you know after a lot of years of slowly building this. I think the opportunity for revenue, but then owning more of the market is is actually huge for us from that standpoint.

SPEAKER_01 21:28

Yeah, and it really allows us just to add way more value to our customers in the end, which has been extremely beneficial. Yeah, so for sure. So we we we launched that in 2018. Correct. And you led that. I did lead that.

SPEAKER_03 21:42

I want you to talk more about that because it it was a big learning experience.

SPEAKER_01 21:47

We weren't even we didn't lead, you didn't you moved, you moved to Yeah, yeah. So there was a lot of learnings that came from from that experience. Um I was at the Beginning, I was a dual role. I was the RFID engineer and leading ARC business systems. And uh then at that point we thought it would be good to keep the two companies completely separate. So we moved to Clear Lake and big move, right? Big move, eight eight miles away. Different zip code. Different zip code, yeah. Had a great office space over there. Uh yeah, you did acting like a startup, and that's what we that's what we felt like as well, because we were shoveling our own walks and uh had no engineering support or anything like that. So uh very neat experience. Um ended up bringing on uh first hire, helping to grow that. Uh but yeah, it was we just treated it like a startup. It was uh that's what it was. It was a startup within uh a much bigger organization. So it was a very cool experience.

SPEAKER_03 22:49

Yeah, I I remember those days where I would I would get I would drive over and see you guys, and I really enjoyed it because uh you did have the startup mentality and and we were doing, I mean, we were just plotting this thing along and and and not knowing what we didn't know, but we just kept moving it along, and it was really a it was really a great period in our history.

SPEAKER_01 23:09

I'm laughing because I remember the our meetings and us sitting at that conference table.

SPEAKER_03 23:13

You're your knee under the small chairs you had more than I felt like I was in kindergarten. I don't know what you were doing to find some of that stuff. I really don't know. It was all IKEA. Yeah, it was all IKEA.

SPEAKER_02 23:22

It was all on a budget, that's for sure. We were on a budget. Yeah, that's right.

SPEAKER_01 23:26

Startup, yeah, startup, yeah. Well, 2018, that was then uh year and a half later, something pretty big rolled around. The pandemic hit. Yeah, and uh that had a big impact on our business, right? Um there was a lot of uncertainty. Um there was uh positives that came from the the pandemic. Uh there was public safety and health of our members that we were trying to take care of, and uh it was a great learning experience for us both, I think. How did uh what did you think about the pandemic? How did it impact us? Uh how would you go about sharing it?

SPEAKER_03 24:09

Yeah, and I think this is where we can have a little bit of back and forth on this, Kyle. But um, you know, I've been through the flood, been through the Great Recession. I I think this is another one of those huge events. Uh the only thing that was different than than this and the other two is those were isolated. Those, those just the flood just affected, well, I mean, in terms of our industry was Metalcraft. Sure, the Great Recession affected everybody. Same with the pandemic. And and there were a couple of fortunate things uh that we had done prior to that pandemic. And number one was we started to make that leadership succession uh at that time, which we'll we'll talk about. I know we're gonna talk about that later. But you became uh COO uh October 1st uh in 2018, which was essentially our 2019 year, our fiscal year. The other thing was we had finally put in place and we were scheduled to put in place our new ERP system, which we did in December. Um and we made that transition, which actually worked pretty seamlessly for our customers.

SPEAKER_00 25:23

Yeah, it did.

SPEAKER_03 25:25

Unlike some suppliers for us, it worked very seamlessly. Unbeknownst to us, you know, we were going to have this pandemic a few months later. But the interesting thing was we started we started hearing some rumblings about the pandemic because our supply chain of inlays was in China, and all of a sudden it started tightening up, and we started hearing, well, there's this um there's there's uh disease over there, there's uh you know major major places shutting down. We didn't, you know, we know it was affecting us, but we didn't think that would affect us here in the states. Uh I went to uh I went to tugboat uh gathering of teams in Dallas early February. It was fully attended, uh, nobody was talking much about it. Uh but again, we kept hearing these rumblings. We started uh the supply chain definitely tightened up, we weren't getting inlays. And uh, you know, uh into February, I I said, well, I'm gonna I'm gonna go to Florida anyway. Went to went to Florida, and within a matter of two weeks, things are just shutting down. Everything's shutting down. I'm in Florida and we're trying to get a handle on what's happening back here. So you and I are communicating a lot, uh, actually putting out some videos along the way because we had to keep our people safe and we're we're just scrambling to see how we're gonna do that. But business just shut off. Oh we we had a we had a worldwide shutdown. Well, we had a U.S. shutdown for supposed to be for two weeks, but it everything is just shut down. Orders dried up, so I I remember I met with the with the team, leadership team, and we said, okay, well, how much, you know, how much cash do we have? You know, how how long can we go if we didn't get any business? And then we had some analysis about, okay, what's what's the bottom look for sales revenue-wise? And what's the impact to our profitability? And uh, can we continue paying people? And I started noodling around to saying, I think we, you know, do we need do we need temporary layoffs here? What should we do with that? And really started um considering that. With Tugboat being a member, Tugboat, there was a webinar about how people are reacting to this. And Jack Stack, great guy, written a couple of books. Yeah, he led one and he talked about having this cat doing this cash analysis, saying, remember something. We don't know how long this thing is going to be. This thing could be months, it could be a year, uh, but none of us know. But you spent years collecting and getting good people. You don't want to let those good people just leave. What he said there resonated with me, and I thought, we're not gonna have layoffs. We are not gonna have layoffs. And I I remember uh communicating that to the leadership team. We're gonna figure this thing out, we're not gonna have leaderships. One thing led to another. We we're all of a sudden that we're in an essential business. We didn't shut down. No, so we had to figure that out. Yes, we we went along with some of the guidelines, but then we also started researching, you did a great job about researching different things. We started fogging the facility, remember? That was that was pretty uh we were doing that weekly, or if anybody be uh came down with a case of COVID, we had uh we got them out, we would fog. Um I I guess if we look back today, uh I I guess it really didn't do that much, but at the time um you know we we felt like it did. Uh, but we did not shut down. We kept the facility going. We had fortunately, because of our new ERP system, we could get some of the back end and front end out of here, have more of a what we call a skeleton crew, we could have people working from home, but manufacturing you can't have working from home. Um, so we also had some staggered, well, we had some staggered hours uh for from that perspective as as well. But my biggest thing is I was kind of stuck in Florida. I wanted to get back here because my belief is I needed to be in here. If I'm expecting our members to come in uh from a leadership perspective, I needed to get in here. So uh I got in here about mid uh mid-April, and you know, I always felt fairly comfortable with that. But um we we produced a lot of short videos. We did some pulse surveys, as you'll recall, is to make sure people were feeling safe on that. But with that, I I kind of wanted to know, and I just really glossed over a lot of areas. I wanted to know what you're feeling like because you know, you're here, I'm in Florida, and and you're the chief operating officer, and I'm communicating with you about how we're gonna keep this thing, uh, you know, we're gonna keep people's nerves a little bit calmed down and how we're gonna work through this.

SPEAKER_01 30:29

Yeah, it was a definitely a wild time. I remember going out and buying as many N95 masks as we could get our hands on. We bought sprayers. This is before we even fogged. We bought DuPont uh Tyvek suits. We were ready to go in. We had it, we had them all staged out in the back in our shed, and we were ready to come in if the case came down. So uh that was just like precautionary thing number one. Um I remember putting together the business continuity team. Yeah. Right. So uh had some members of the leadership team, uh, some from engineering and HR, so that we could we were meeting every day, uh, the business continuity team was to make sure that we were up to speed on, you know, what we were hearing from a you know, from a case standpoint, what to do, you know, what is social distancing, all of those things. And we were learning it as we went. Um, and you know, that we would get out the communications as soon as we could. I mean, getting out as much uh information to our members as possible. Um yeah, it was just it was just learn as you go and uh overcommunicate, and we tried to keep people as safe as we could. And we we did. I mean, we had plastic up everywhere, we were social distancing. Um, you know, you say you can't have people working from home and manufacturing. We even did that, if you remember. Um, we were we got we got kind of lucky. We found found a little uh needle in that downturn of the business, right?

SPEAKER_03 31:58

We did we did. Yeah, yeah, we did. We you you came up with the concept about uh yeah, if you're you're talking about the face shields.

SPEAKER_01 32:05

Yeah.

SPEAKER_03 32:06

Um you came up with this concept, and it was very early on, it was mid-March. Uh well, I actually think your daughter-in-law came up with it. Yeah, that's right. I don't want to take credit, but that I did make it. Yeah, you made it. That's why I met, yes. Uh my daughter-in-law, because she was working in the medical profession, um, she said, hey, there there's a need for something that needs to be designed. You came up with that design, and we started producing these things. We did. And we produced millions.

SPEAKER_01 32:35

We produced millions of face shields, yes. And we were assembling them right here in Mason City, and that's even how we got uh some manufacturing members to work from home. We set up uh a loop where we would drop off boxes of raw materials the morning, and then the next day we would come back and pick them up and drop more off. So uh they were manufacturing them right in their own living room. Yeah.

SPEAKER_03 32:58

Yeah, it was kind of interesting because I, you know, I I I considered the flood and what we did with the war room. I I talked about that in the last podcast, and and really that business continuity team was kind of the war room. Yeah. It was it was the same thing in terms of you guys meeting daily and figuring that out. You know, the other thing that was interesting is uh, you know, eventually there was some relief because we, you know, we were the first four months, it was it was hard on us. We were it wasn't as bad as we initially thought it would be financially for us. Um but it was still it was still it was still rough. But then the PPP loans came about, and we really vacillated, or at least I did, whether we should take advantage of that or not. Because in some respects, you're thinking, oh, I want to be independent. I I I don't want to necessarily take advantage of that money. However, the biggest thing is it we didn't know what was gonna happen. We had no idea where this was headed because there was talk about, oh, it you know, it started to settle down a little bit in the summer, but they said, okay, uh, you know, come fall again, there's there's gonna be another contagion out there um, you know, that that will create as you know, they'll wreak havoc. So, you know, we took it, we did take advantage of that, um, of that PPP plan, which was extremely helpful for us. One of the other really unfortunate aspects of of this that again um you have no control over is you want to see the health and safety of every member. And we ended up losing, uh we ended up losing a member passed away during this uh time, which was very, very tough, Julie Haugen. It was very, very challenging for me to see that. Now, you know, there's some there was also some extending circumstances how that happened, but uh there's only so much of control on that, and that was um it was sad to see. Uh, and then that kind of weighed on me, but it was one of those things where it's COVID, um, it's a pandemic, uh, you do your best, and I and I think we did our best to keep the business rolling, which was certainly uh in in the best interest of all our members. Uh we had to feed them, we uh but at the same time keep them safe. And I think we overall, uh you did a tremendous job about keeping our members safe. Well, thank you.

SPEAKER_01 35:33

Yeah, thank you. Well, there it was uh it was definitely a challenge and great learning experience, and hope we don't have it again, have it do it again. So right? You there were positives that came out of it. Yes, right? Um there were some supply chain issues. Yes. And that led to us looking at a new business opportunity.

SPEAKER_03 35:53

Yeah, yeah, that was. And um you mentioned there's always yeah, that that's in any situation in life, and this is just another one. Um, and and again, we can look at our history, it's the same thing. Uh the flood really was the impetus for us to get to this building, for instance, and really grow. So in any circumstance there, you there's gonna be a positive. You have to be able to read what that positive could be. And I remember um we were frustrated. Uh, you and I in particular were frustrated about that supply chain of inlays, RFID inlays coming from China. And it seemed like everything uh was uh first of all started basically in Taiwan for the wafer, and then it would flow through China for the inlays, antenna inlays, and it was like that's that's the supply chain. And uh uh that was that was hard to say we we really don't have any control over this. Well, the interesting thing is there were companies out there, Mull Bauer being one, that had a way of direct die attach, but the investment was well over a million dollars. Now we've made that investment before, but at the same time, we were thinking, I don't know that this pencils out. I mean, I remember speaking with you at first, and we thought there's no way this is gonna pencil out. But then we we just kept thinking about that. Well, if if it could pencil out, how would we go about this? And so we you and I started pursuing that. And it was interesting because we uh Moebauer gave us, Muhlbauer gave us a spreadsheet that we could do that analysis, and then I had you say, Hey, what inlays could we produce, uh universal inlays, for instance, that we were going on the outside. Could we produce those? Could we produce others? And we went through this justification and we were thinking, oh, there's it's the likelihood of us being able to do this, probably not good. But lo and behold, after we went through that initial spreadsheet, it was like, hold on, I think there's a possibility. Yeah, and then we just kept developing that and we really honed in on a few different things. We we developed that. We went through a pro-con list. You and I went through this pro-con list, and it was like just you and I, it was just you and I. It was one of these skunk works kind of projects, didn't involve a lot of people. And we said, yeah, it looks like we can justify this million-dollar investment. It was exciting, but it was part of the decision maker is to saying, we need somebody to poke holes in this. We need somebody to tell us we're nuts, we can't do this. But we had to leadership next, uh, they looked at it, they had some questions for us, but nobody was able to poke enough holes in that that it would just uh you know derail the whole project. And then they went to the board of directors and said, look, we because we we have to get approval on anything that's more than 500,000. We went to them with the same case. Uh they saw his opportunity. And what what I liked is the visionary that we have from the board is they they look at things about, well, what can this do for your business down the road? Um, so all systems were go.

SPEAKER_05 39:11

Yeah.

SPEAKER_03 39:12

We we said, yeah, we're we're going to make this decision. It was early November. We said, we're going to do it. We, and from that point, we ordered. And then we had a lot of work to do because we had to manage the project. We had to do things remotely that we would normally do in person. I'd like to have you talk about because in reality, I kind of said, okay, Kyle, you know what?

SPEAKER_00 39:38

My work is done here. I'm making the decision now. You've got to put it into place.

SPEAKER_03 39:45

And uh you had the heavy lifting to do because it was like, okay, we got to take delivery of this and we got to put it into place.

SPEAKER_01 39:52

Well, and and I won't say I did it all myself. Dean Hansen played a big part in that, and he was our VP of uh manufacturing, senior VP of manufacturing at the time. But yeah, it was definitely interesting because we did uh the factory acceptance test over video. Yeah, two hours. Yeah. And uh we even did some training with an operator that we hired uh during that time as well. Um made the decision to move it down to Ames. And why was that? Why why did we decide to go ahead and not move that here? Well, we wanted to look at redundant locations so that we could have backup manufacturing in some place other than Mason City, right? We already had an office in Clear Lake, right? Yeah, very small, a few hundred square feet.

SPEAKER_00 40:33

I don't think you're you're gonna get much equipment in that.

SPEAKER_01 40:36

No, the mobile hour would not fit in there. So we um we partnered with Iowa State Um, the research park, and they did a great job of finding us space that was usable, built it out for us, what we wanted. Yeah. Uh we were able to tie to the university more to utilize their resources uh from a standpoint of labs and uh professors if need be. That was that was exciting to us. Uh gives us a place for our interns. We use a lot of uh software development insurance. It gives us a place for our interns to home. Uh so yeah, it made a lot of sense to put it in AIMS. Uh once we got the you know the equipment ordered, we went to work on that facility, uh, went to work from an HR standpoint. We're able to find some great members down there uh that are still with us today. Very proud of that. They have a great team down there. And and since we've put it in place uh and been up and up operational, it's allowed us a lot of other uh opportunities specifically around inlay design and being able to prototype uh rapidly for our customers for unique applications. So that's been very, very good. We've also put a couple other businesses down there. We put uh A to B down there, sure for the acquisition we made there, put that equipment down there, and we've also added uh label converting as well. So it continues to grow.

SPEAKER_03 41:58

Yeah, we really expanded that. And I think that's what that that that's another thing that we felt really good about is that this would allow us to, you know, made in USA was after the pandemic, that was the other advantage. People started saying and taking note about how much is being made outside this country, especially in China. And we really played to that, saying, these inlays are made. Now, sure, we still had to buy antenna that was not in the United States, but these inlays are made in the USA. And it started to play, but the big thing on that is we could do rapid design of rapid design of new antenna and prototyping and offer that from the beginning to the very end, and and then put that in a usable label product so truly uh uh truly the entire system could be done. And what we're doing with antenna design is is really truly I would I would say world class from what we do with the antenna design. And I think that's gonna uh allow us to have just a wonderful opportunity in the future.

SPEAKER_01 43:08

Yeah, it is, it is. So that was a that was a big um strategic business decision for us, right? Tell me more about uh some of the other ones you made along your career, specifically like the compass, our why, how, and what.

SPEAKER_03 43:25

Yeah, the uh the compass is a big deal because uh uh my son Jared uh he reached out to me and uh it was probably around 2014 and he said, Hey, um I I just attended this this big sales meeting that we had with his company 180 Medical. And they they they were talking about this book, Start With Why. And you have you heard of a guy named Simon Sinek? I said, Yeah, I think I've heard of him, but I I don't know that much about him. He said, You ought to dig into that. So you know. Immediately I thought, okay, I I looked the, you know, I bought a copy of the book, Start with Why. And Simon Sinek is a very, he's a very talented guy. He's been exposed to a lot of business. And the book resonated with me because one of the things is I really struggled with our mission vision. I struggled remembering it because we we couldn't get it concise enough. And I felt like if I struggled with knowing it, how the members, how the how is the team supposed to identify with this? So the the why, how, and what just resonated with me to saying, one, I think we can get everybody behind this. They'll understand it, we'll we'll make it concise, people will know what it is, and we'll tie into this much better. So we formed uh, and you were part of that team, we formed a team, and there were, I think there were eight or ten of us. I mean, it started out eight, I think we moved it up to ten. But at the time we were like 80, 85 people. Well, we were about 85 people. Uh, so that was a fairly decent representation of the company. Not all managers, we we had different people in there. And we spent a lot of time on just the why and getting each word connected so that if you really take a look at it, every word is connected and has that meaning. And same with uh same with the how and the what statement. And it really that is what became the compass. And the neat thing about it is we developed and we finalized this in 2015, uh, Kyle, but we're still using that today, 11 years from now. And I think we've made one or two word changes, but that's it. I mean, it's not like we said, let's scrap this. So it seems like an emission and vision. We were for reformulating and scrapping it every three, four years. And to me, it just it wasn't it wasn't a long, it wasn't a long ball. I wanted to develop something that we could would be visionary, that would work for us today, but it would work for us long term down the road.

SPEAKER_01 46:12

And I think our members really tied to it. And yeah, we made one word change. Yeah. From and to two. Two. Yeah, and to two.

SPEAKER_02 46:20

So it's like, oh, major. Yeah, major and to two. Okay, all right, that's good. To make the complex simple. That's right, exactly.

SPEAKER_03 46:28

So to make the complex. Yeah, and when we think about that, make the complex simple, man, our members really tie. And the beautiful thing about that is we they tie into it from the standpoint of not thinking it's going to be simple for them. But they are we're making it uh, you know, we're being very transparent to our customers, making it simple for our customers. And I think that's what I'm really happy about. Our members, they don't, you know, they just don't say, well, this doesn't make it simple for me. They truly understand is that, yeah, it may be a little more complex on our end, but it's if it's easier for our customer, the better. Yeah.

SPEAKER_01 47:09

And it ties in, I mean, we added our values underneath it as well. And those are, you know, obviously number one value, member owner focus. That's always been extremely important to you and myself and uh the entire leadership team. And uh so we you've made some strategic business decisions around that as well. One in particular, going self-insured. How did you make that decision? Why would you make that decision, and what impact do you think it's had on the business?

SPEAKER_03 47:39

Well, well, first of all, I I think I I wasn't the only one who who was made that decision. It really was fortunately we had at that time there were LMC, um and and and I guess they're now another company, but uh at that time it was uh I think I really kept pushing for this because the thing is when when you're talking about health insurance, uh you're at the whim of the insurance company and and the rates. The the frustrating thing is we would have a a very good year where our claims uh to premium uh were much lower than what our premium was. And yet we'd still have an increase. Uh it just wouldn't be as much of an increase. And then we'd have years where our claims were much higher than the premiums, and we'd have a phenomenal increase. So I'm thinking, okay, well, how does that balance out? I mean, you guys are making money when our claims are lower than the premiums, but yet when we do have a tough year, and then you guys just jettisoned this. So it was like we need to be self-insured. We need to have more control over this, and really started that foundation uh for at least two to three years before we went to that. Um, and then the year that we made that change, I believe our stop loss was 30,000 initially. So the stop loss just meant that anything below 30,000 we would pay. Above that, we'd have this stop loss reinsurance. And the wonderful thing about that is yes, that could go up and it would go up every year, but that was only like a third of the entire part of the cost of the system. Um, so yeah, even if that went up as say 20% as a third of that, you know, that's 7%, it's not bad. And we really wanted to instill more of a um consumer-based philosophy with our members. And there's still a lot of room, uh a lot of opportunity, I believe, to do that by letting our members know. Now, uh, once we institute that, we never look back because it's really been a good system. I I think overall, uh, if we take a look at I we've probably had that for six, seven years, but if we take a look at that overall cost increase to our members, comparatively what it would have been for if we would stayed with the the common, well, we're gonna go with an insurer 100% of the way, we have saved our members a lot of money. And to me, that's a huge benefit. Um having really good health. And and we're we're talking about the the the best of the best, the Cadillac, the the blue, the well marked blue cross blue shield, having the best of the best policy for our members was very important for me to extend that to our members. We made the mistake one year of going in with that and up because again, we are price. I think we were here at that. I was and it was a disaster.

SPEAKER_01 50:36

Yeah.

SPEAKER_03 50:37

It was an unmitigated disaster. And I learned my lesson saying, we're not gonna do that again. We're just we're gonna stay away from that.

SPEAKER_01 50:44

Well, I think it really ties to the ownership mentality, too, that we we want to carry forward here at Metalcraft for sure. So um staying on the member owner focus. You part of your legacy at Metalcraft ties to something that you're still working on, professor, right? And that's that's university.

SPEAKER_03 51:05

I think you can maybe get a little carried away on that. I'm a you know, I'm I'm not even an adjunct professor. I think I may be a lecturer uh in that range. Yeah. University of Metalcraft, sure.

SPEAKER_01 51:15

Yep. And it's it's had uh a positive impact on so many members, um both former and current members, right? Um tell us how you came up with the idea of University of Metalcraft and the impact that it's had on the business and our members.

SPEAKER_03 51:32

Sure. Um somebody suggested, and I I don't know where it came from, but uh you of course you always have these, you always have a uh people out there, friends, acquaintances. And somebody suggested this book, Everybody Matters, by Bob Chapman. And it was about his company. It was a multi-billion dollar company, it was private. And he uh, you know, and I uh it was a great read. And I get to the one chapter I was University of uh Barry Weimiller, and it talked about their leadership program, and it resonated so much with me. It was we have this, we have this value about uh member owners focus, and under that value is that we want people to be active in their, we want to be active in their personal and professional development. And I thought, what better way could we than than having something like University of Metalcraft? So that whole chapter, I I was making copious notes and getting excited about it. This is this is early 2018. Then I happened to go to my very first tugboat summit. And one of the small little breakout groups on Friday, right before you leave, we were this the subject came up, and it was stotts. Um, and they had set up their university program, and it was like, no, no, no kidding. Tom was going through this in detail, and I'm I'm like, this is this is too good to be true because I'm interested in this. Well, I hooked up with him, and he he spent at least a half an hour with me and provided me some some you know thoughts about what they were doing, really good ideas that I hadn't thought about, and then formulated and came up with uh with a curriculum, if you will. And I went to the leadership team and said, this is what I'd like to do. And I think uh, you know, initially maybe some of the leader managers were saying, Oh, you you want to do what? And um, so you're gonna take somebody out of my department for a full day for how how long? And I said, Okay, well, we're not gonna do this all at once. You know, we'll have three, four months between this because there's a lot of prep work. And we started that in 2018. We graduated uh this uh literally we're gonna be graduating within a few days, the the third class.

unknown 54:02

Yep.

SPEAKER_03 54:03

Excited about that, that we've had three classes through. What I'm also excited about is we're gonna start our fourth class uh in uh 2026 here. And the beautiful thing about that is there's five of the nine were hired after I retired as CEO. I'm really excited to continue this. I think I'm more energized now, Kyle, doing this than than I was when I first started. Maybe because I had other CEO duties, but and this is my sole focus. But I think just I I see how this is growing. I see the opportunity it has to develop people, and I see people developing, and I get excited about that.

SPEAKER_01 54:51

Well, it's it's been so positive on so many people's lives, and I know it's been a big deal for you, but also even bigger for those members that have graduated from it. So that's pretty cool to see. Um, I know that uh there's probably just as much uh benefit of of you doing it after CEO because they get a CU. You know, they don't the those five that you mentioned, they didn't know you. Yeah. Um so you know, tying back into the history and you know, they hear the stories, right? Obviously. Yeah, the good, the bad, the ugly, right? They know the legacy, exactly. So um Metalcraft were involved with a lot of industry associations, right? And they've been beneficial to myself and I think to you. Um talk a little bit about some of them, maybe AIM and GPI. What what impact have those had on you?

SPEAKER_03 55:44

Yeah, I mean, uh tremendous positive impact. When Doug and I uh led the led the buyout, again, we're in Mason City, Iowa. This is again, this is before it's not before before uh the internet, but before you get a lot of information out there and it can network, right? And so we're a little old Mason City, Iowa, and we need a way of networking. Uh when we the very first meeting that we went to, we both attended was GPI, and it was October. So very early on, uh we go to this GPI event, and of course, you know, they're introducing us uh as the the new leaders of Metalcraft, and and we learned we started learning a lot more. I started learning a lot more about the industry at that point in time, which was very beneficial because prior to then I'd never attended, I'd never attended a GPI event. Uh so GPI was very helpful, as was AIM early on. Um I to me, it was not just about, you know, what can I what can I pull from these these organizations? So it's all about me. I can just pull. Then it became, well, how do I get involved to make these organizations hopefully stronger? And so I served on the the AIM board. Uh I served on GPI board as as well because to me I wanted to make that that organization much stronger. But then in 2017, by just by by luck, I mean by luck, uh I I got I got a um one of those emails that got caught up in my spam filter. And I thought it was from we have we have a representative out there named Sean Zax. And I took a quick look because this is Sean Zach. And so I thought, well, how'd that get stuck in spam? I mean, this is our this is our rapid scan. I was ready to go to IT and say, what's going on here? Well, I I released it, and then I thought, oh, this is Sean Zach, not Zax. And what caught me is it was about Evergreen. And I thought, well, let me spend a minute reading this. And so I read the the the seven P principles, and everyone I ticked off about private and perseverance and purpose-driven, pragmatic growth and profitable, all these, all these seven P's, I thought, well, this is this is us. And it was about, well, be part of this organization. I thought, well, sure. So that was the start of me becoming involved in in learning about Tugboat, and then eventually becoming a member of Tugboat. And I remember going to the very first summit because I felt really good about our company. I thought, I, you know, sometimes you get a little too prideful. You think, oh, we're doing we were doing all this great stuff and everything. I went to my first summit, and my reaction kind of was, how did I get in?

SPEAKER_00 58:55

But uh, because I see these other private companies around, it's like, how did we get in? But you know, I don't care how I got in.

SPEAKER_03 59:02

I want to stay in and I want to learn. Uh I want to learn from some really great companies. And that organization, Tugboat, singularly has was the most impactful of my leadership ability. And and the the founder, Dave Wharton, I know I've expressed to him many a time. I said, you know, you were you were founded in in in 2013. And I wish I would have been there like in 14 when I really needed you. He said, he said, well, Steve, we are I you may have not liked us back then. But I'm glad it worked out because and you know this as well, because I, you know, I wanted to, you involved in this, and now you are you're the member. The exposure to companies that are revolutionary, as I would say, within their own industry. And you you get companies from 10 million to multi-billion dollar companies, it humbles you pretty quickly to what they're doing. But the people first and and how successful they are, and and what you can share with each other and some of the things I brought back, and the education and the professionalism, it's truly been impactful for for me as a leader. And I think for you going forward, especially the forums you're involved with, right?

SPEAKER_01 1:00:32

I just uh really, really great group of humans that were part of there. Um and I you you were humble and not talk about in AIM and GPI, you talked about you wanted to leave them in a better spot and give back to them. Well, I'll go on the record here and say I guarantee all those tugboat members think that you've added value to them as well. I've seen some of your speeches, some of the work you've done there. So thank you. Uh kudos to that. Pretty impressive, pretty impressive stuff there. Um, I know it's been very, very moving for a lot of those members.

SPEAKER_03 1:01:06

So it is the um it's been the a great association of of people have a vast amount of respect for for these people as leaders and the success they have, but not only the success would they have with their companies, but just how um how put together they are in life and period. Yeah. And that's the impressive thing, is they're leading companies differently than most of these other uh leaders are in the in the public companies, right? In the public and private equity world. It's much, much different. Which that also led me from saying, I'm staying away, I'm resisting the private equity. Sure it looks attractive, but for our people it's not the right thing. And um, that was very helpful for me to saying we're gonna we're gonna continue to resist this no matter what.

unknown 1:02:04

Yeah.

SPEAKER_01 1:02:05

Well, speaking about resisting it, one of the things that we did to do that, right? To resist the private equity would be, you know, going to 100% ESOP. And we we've made that move. Um, I think it's been a great thing. What what really sparked that, led that? Give me your opinion on why 100%. Yeah. What a great segue, huh?

SPEAKER_03 1:02:28

Uh well, it w you know, again, uh Doug and I talked a little bit about this when we when we had the buyout with Wally and Six and we created the the e-sop. It was it was a partial e-sop, the 51% e-sop at that time. And because we both, we were both fairly large owners, and and we liked the concept of of all key individuals being owners as well. So it all the leader managers were owners. But when when Doug sold all his shares, that jumped up the uh we we couldn't resell those. We didn't have enough big enough market internally to to to to have those shell those shares required. Um so what that did is that that eventually shifted the ESOP to 65%. Then when I sold mine, it was projected to be you know 70, 75 percent. And the thing with the subchapter S is you're paying out a lot of money for distributions to cover taxes. Uh and so you're making this this big investment out there. And when an ESOP becomes that that big uh financially, you're saying, is that is that the right thing to do for the for the company? Is that the right thing to do for the members that are in the ESOP right now, especially when you're considering the repurchase obligation and the distributions, and you want to make the best decision for keeping this company viable and growing way past when you leave. So the timing was right for us to shift to 100% eSop. Now, the the beautiful thing about that is again, being part of Tugboat, there are a number of ESOP companies, and there are a number of uh ESOP companies like us that didn't go from zero to 100. Sure, there are some, but many of those companies went you know gradually, maybe 25, 50, and then 100%. So we were able to learn a lot from those experiences, and uh and and that's exactly what we we did. One of the things that uh you know Doug and I set up for is saying we have to have an effective way of continuing this leadership. And we think that 100% Aesop was the best way for us to do that as well.

SPEAKER_01 1:04:59

Yeah, because there was definitely some back and forth, you know, stay hybrid, go to 100%. I think the other thing that really played into it too was timing, right? Um, we were running out of shares. You guys set it up for 18 years. Yeah, we did, right?

SPEAKER_03 1:05:12

Well, we we in 18 years, and and yeah, thanks for bringing that up. 18 years we thought like that's a long time. And it was back then, but now today deals are 50 and 25, and ours is um so you you know one of these days somebody's gonna have to take a look at that. But you're right, we were we we had to have some event uh to to happen. So why not just evolve and and buy out the current shareholders and then uh make this evolution to 100 percent. The timing was was outstanding. Yeah.

SPEAKER_01 1:05:50

Well, tying into you know, tying into tugboat, long-term profitable businesses, and tying into the ESOP, right? We just celebrated 75. Years you know, set a new goal of a hundred years, right? It'd be a hundred year old company. So, what what is the importance of 75 years to you and and what does that look like? Yeah.

SPEAKER_03 1:06:13

Well, first of all, not many companies make 50. Certainly not many companies make 75. Um, so it is it is a milestone with with without a doubt to make 75. And then to make 100 uh is is that's a great goal to have. And that'll be another, and I'm have all the confidence in the world we'll we'll make a hundred. But when you think about what you have to go through to to make 75 years, we had to go through a there had there was a major shift in 59, a major buyout shift and transformational leadership in 1959 early on in our history. Then we have the Patton family that really had control of the company, and there was a major shift in '93 with Wally. And so he was the right individual at the right time to make all that happen. And then we had that second, uh, we had that third shift in 2006, with Duck and I being the right individuals to keep this thing going. And then the 100% Aesop is really the fourth generation, if you will, of to keep this successful. So that's just one, that's just the kind of the nuts and bolts of the company. But when you think about the innovation and what what's transpired from that, going from where you're just crashing and doing numbers to control assets, to now adding barcode and and behind being behind the eight ball and implementing barcode, people being ahead of you and you having to play catch up, and then you being on the forefront of RFID. And in fact, actually, maybe the I think we can almost say bleeding edge sometimes. I mean, we were taking the arrows in the chest sometimes, but it we were. We were we were the leaders, and now we're looking at new technologies, and and we're also looking at other other opportunities where we can create more value, add more value to our customers with business services, with inlay innovation. Uh, that's exciting. And to do all that and yet be successful and profitable, and be profitable during the Great Recession and be profitable during the pandemic, uh, those are foundational areas, foundational issues that keep our company very, very strong. And uh we are stronger today than we were certainly 50 years ago, 25 years ago, stronger today than we were two years ago when I retired as CEO. So being in business for 75 years, there's again, it's it's rare air. It's just rare air.

unknown 1:09:11

Yeah.

SPEAKER_01 1:09:11

Yeah, it's uh it's pretty powerful, pretty powerful stuff. Uh you talked about you talked about your retirement. You talked about we throughout this podcast, we've talked about um my roles, my various roles, succession planning. Um I I really want to dive into you know what that succession plan looked like. Uh and we can talk about that, but but I want to first talk about your retirement, why you know what brought you to that point. Uh how'd you get there? Sure.

SPEAKER_03 1:09:48

Um well, as we talked about in the last podcast with you know, Doug and I both having MS. And then when I was diagnosed with MS in 12, you know, I was still feeling real really good, and I felt like I could I could lead the company. I was I still had a lot of energy. In in 2017, I mean I was I was doing you know really, really pretty well. I was five years into it, doing really well. And then I had this this major MS episode, and it was interesting because it was, I remember it was right around it was your 30th birthday party that we were supposed to go to. And we ended up going because uh for one, I wanted to see your parents, but I could, I I had this major inflammation uh event where I couldn't barely walk. And we had gone to Israel like four or five months, well, about four months before that. Um, and so I had these, I had fortunately I had walking sticks there, uh just kind of hiking sticks that I used over there. And I think I may have used those to get to your to your birthday party, but I could barely move. And I I went to the doctor and they said, well, we're gonna put you on this five-day regimen of one gram a day of steroids. It was like 45-minute intravenous. And boy, it messed me up, but it worked. I mean, it really, really reduced inflammation. It took me about four weeks of rehab, but I I got my mobility back. Fortunately, I was thankful for that. But I also realized, okay, this is an event. Uh, 17. I I really need to think about uh more than think about, we need to be planning as a board my succession because what's the next event going to bring? And that's very important. So I went to the board uh that that that October and said, okay, this we need to start planning for uh for my succession and my retirement because it's gonna take us a few a few years uh from that standpoint. Um so that's really what got me to thinking about retirement. So the next part of that is kind of the succession, right?

SPEAKER_01 1:12:00

Yeah, I mean you were you were very purposeful on the succession planning. Um succession planning's hard, right? I mean, it's not yeah, it's not easy. Not uh not a lot of companies can say they've done it well. Um so tell us, you know, what your thought process was around succession planning and how you went about it.

SPEAKER_03 1:12:22

Um Yeah, and you're right. A lot of companies can be successful, but they don't get that right. And that's where the the that that begins to downfall. It's not what I want. You know, I wanted to keep this company very strong as well. And and so one of the first things that we did is we said, okay, are there potential internal candidates that can do this? And and in reality, it's tough to envision that. Uh in you know, you're you're a name that certainly came to mind. The interesting thing about it, uh you were you had only been here for five years at that point. Your RFID engineer hadn't had any real leadership uh of anything, and not even you know, uh of anything. You were very, very important role in in growing that business, very capable, but you weren't in any leadership. But yet I was envisioning you because I had known you for longer than the five years that you were here. And and so your your name was out there, but it was like, I this is a vision I have. But then the board is saying, yeah, but he's you know, this is what he's doing. He said, fine. Um, let's let's try to create some pathways here. I I remember going to you and I said, you know, I got a wild idea here for you. And it was a wild idea, and I'm not sure, you know, I think ultimately it turned out to be a great idea. It was it certainly wasn't going to be anything long term because it was like it was too far out there. But I said, hey, we have a lead opening for the autographs team.

SPEAKER_00 1:13:58

So I here's what I want you to still be that, we need you to be the RFID engineer.

SPEAKER_03 1:14:04

But I also think it's a great opportunity for you to get some leadership behind, you know, under under you and be that supervisor, that lead of the autographs team. And it must have seemed it was out there as an idea. It must have seemed crazy to you.

SPEAKER_01 1:14:19

It was crazy, but I was grateful for the opportunity too. Right. It was it was fun. Um unique team, the oldest team that we had at Metalcraft, right? I mean, just the oldest product line, so the most uh tenured product line. Uh so it but it was a good experience. It was fun. We ultimately changed, uh we pivoted to the RFID.

SPEAKER_03 1:14:41

We shifted because then the opportunity came up for saying, hey, well, this makes sense. Yeah. So uh lead an RFID and you're right there.

SPEAKER_01 1:14:48

Yeah, that made a lot of sense because I was I knew that side of the business and uh knew all the people and had respect uh from those members and yeah, made for an easy transition to to the RFID lead. Yeah. I mean, along the way, you were still you were not officially, but you were mentoring me as well, right? Helping me uh find my blind spots, work through those we were able to meet, you know, and that as a someone that's been with a company for five years, you know, that doesn't always happen, right? Um to to be able to meet with the CEO um when you're not reporting to them, right? And so I I really do appreciate that. But but you were very intentional in uh in putting together uh the succession plan after that, right, with the board. And you want to talk a little bit more in detail about that?

SPEAKER_03 1:15:39

Yeah. Um so one of the things is, and and we we accelerated this process relatively fast with you. Because as you recall, um uh in in reality, I'm I may, I I think if if I look back at the timeline, I think I may we you may have been part of that autograph lead before even 17, because I just sensed that you had some leadership. And I think that was really the timeline. It wasn't it wasn't the the fact that I in 17 this happened, I went to the board. I think we actually may made that it was it was before I believe so, yeah. Because in reality, once I went to the board in October, then one of the things they said, well we we gotta see them in a leadership role. So I thought, well, what better of a thing to do is get you as leading innovation and technology.

SPEAKER_01 1:16:37

Yeah.

SPEAKER_03 1:16:38

So we we made you VP of innovation and technology somewhere along circa January of 2018. Yeah, your priority. I think that's when it was. I think that's when it was. Uh and that's when you you still had uh the innovation team responsibilities under you. Yep. You still had the RFID lead kind of well, not not the response. Not the lead, but I was doing the engineering part, yeah. Engineering part of that. So we we had you we had you chasing your tail there, but you were exposed to the leadership team on that. Um and then we became very intentional that spring, we set up a plan, and the plan was that if we were gonna go down the internal route first of saying, okay, well, because I I just felt like that is what we want to do initially. Now, if we have nobody internally, then yes, we're gonna have to go uh externally. But we set that up and we uh we enlisted this psychologist, Tim Fullock, and he was used to working with C-suites. Uh you remember it well because it was a long day. Puts you in a lot of testing, right? Long long day, yeah. And we we had three people go through this. We got all the results, and you know, we saw the the positives, we saw the maybe the concerns, uh, and you scored very, very well. And and again, that excited me because that was my belief, but but we had to we had to back that up. So the next part of that was was the initial interviews that we had for ever for all three that were interested. And then from that, and that was with the board. That was not with the full board, but we had we had one or two board members and myself and involved, and we felt very comfortable that you had done the best job. And so we just narrowed down to saying if we have a person here, it it's it's Kyle. So I remember I went to you on a third, I went to you. This is this is cruelty, I know. But I went to nightmares over it. Yeah, I I I I I I went to you like on a Thursday. Kyle, good news. Yeah, what's that? Um you we're gonna have you back for a second interview for the full board. Okay, well, what's the other part? Well, that's gonna be Tuesday. And here's why I want you in 90 minutes to give us your vision and how you're going to lead the company and what your vision is, and give you a few other parameters. You had to work like all weekend to do it. 90-minute presentation, yeah.

SPEAKER_00 1:19:27

Yeah, 90 minutes, yeah.

SPEAKER_01 1:19:28

It's the longest presentation I've ever given in my life.

SPEAKER_03 1:19:31

But but I I tell you uh Tuesday when you did that, it was like we solidified this thing. Now, the the the biggest thing that Tim told us, and we had a lot of contact with him. He said, Look, I I the there's no question, you guys are doing the right thing, and and Kyle uh eventually is the right person, but he needs some runway. And I said, What do you mean by runway? Well, he needs he needs five, seven years. I said, really? He said, Yeah, you do not want to thrust him into the president because we're looking at hiring a president. Yep. You do not want to thrust him in a role that he will perhaps have frustration or there's failure. You want to bring him along and mentor him. I said, okay. Um, but I'm I'm really thinking three to five, not five to seven. Fine. Well, we'll we'll get to that point. So we decided to alter that position. When went back to you, and I remember when I made you that offer, it was uh went to your house and Laura and I went there and we we made that offer and said, look, um, we're we want you to be CEO. This is a great opportunity for you, based upon how you do here, to ultimately lead the company as CEO. But this is going to be, in my opinion, it was going to be three, five years, maybe three, six years. And that's when you became COO. You did that very well for for two years, and the board felt so comfortable that the the process was that we were going to interview for the CEO role. And we decided to forego that. We had you in, we had you in the board meeting, and we we just had this nice conversation, but we put you through the paces, we knew that you were the CEO. So then we promoted you to be president. And um I was beginning to to you know, my my retirement date was the 24th. October, uh September 30th, 24. Well, what in 22 I began to really struggle having the energy. And I remember I it was July in the summer, and it was over a course of two two nights, two kind of sleepless nights. And I I did a lot of a lot of a lot of thought. I I prayed about it and I said, I don't think I can go on. And and so I announced to I I told you at the time, and then I announced to the strategic planning team that we're gonna advance this. I I am going to retire the end of 23, our fiscal year 23. And by the way, I think Kyle, I I don't think he is ready to lead the company. And I felt like I would not be the CEO that I wanted to be. Um, and felt like you were in a position to begin leading the company, and now it's time for you to take the company to a better position. So that's really how that transpired.

SPEAKER_01 1:22:35

Well, one of the things you forgot is all the hard work in between that that you put in. I mean, we were meeting how many times a week. Yeah, yeah.

SPEAKER_00 1:22:43

You know, we had Well, I didn't want to get into some of those gory details. I was trying to forget that, but I I I figured you'd remember because it was like really I had to meet you twice a week. Meet a couple times a week.

SPEAKER_01 1:22:55

We had a list to just get through. Oh, yeah. And we were we were checking them off. We did.

SPEAKER_03 1:23:00

We had this extensive I I made up a spreadsheet, I think, right?

SPEAKER_01 1:23:04

Yeah, oh yeah.

SPEAKER_03 1:23:06

And and we had to get through that, but I I recalled that. Now, of course, if it didn't work, but but generally if it worked, yeah, we were meeting, and it wasn't like we were meeting for 15 minutes. No. We'd meet for an hour, maybe more.

SPEAKER_01 1:23:20

Yep uh twice a week. I mean, it that's that just goes back to how intentional you were on it. I mean, it because there was there was work that had to be done from my standpoint, right? Uh, like you spoke about. So uh it was extremely impactful for me. So thank you. Um but I think you survived it.

SPEAKER_00 1:23:41

That may that may have been part of the process. I could if I can get through this, I can get through anything, I can lead the company. That's right.

SPEAKER_01 1:23:49

Yeah, no, it was it was definitely a a well thought out process. And I would say, you know, one of the the you've done many, many great things here, but one of the very intentional, um, really strong pieces that you left uh for Metalcraft. And I'm not saying that because I'm in the role, just the process that you put in place and the groundwork you laid and how much uh time and effort you put into it. Yeah, absolutely. I appreciate that. So, you know, looking back at your time at Metalcraft, um, you know, all the people, all the growth, the impact. What would you say you're most proud of?

SPEAKER_03 1:24:30

Yeah, I I the the biggest thing I I think is and certainly um Amanda, I I miss the people, which is th thank you for letting me continue to lead University of Metalcraft because I I really enjoy staying connected to the people that way. But the the yeah, the growth we did, we we checked off you know some boxes there. But the big the biggest thing for me, and I always look at it as the the mark of a of a good leader should be that you're you leave the company in a position that the next generation will be able to grow it even more. So you made it, did you make it better than when you started? And is it in a position to be even Uber better than when you when you left it? And I think that's the mark of a leader of a good leader, because you see in public companies that um what is it, Bob Iger, he's come back how many times for Disney? And and I I look at that as saying, is that really a good leader, or shouldn't they have had this succession to make somebody else could make the company better? And so from my perspective, it was like I I had a I had a great run. I had I had excellent opportunities, uh, strong foundation. I learned a lot. I enjoyed the heck out of it. I still enjoy today. But in terms of a CEO, there was no question you were ready to lead it. Uh it was kind of, especially the last few months, it was kind of like uh you were you're in in limbo, just just waiting to lead it. And I felt like you're in a you're in a great position. I'm blessed, the company's blessed to have you as a leader. Everything works, everything has a purpose, and it was uh it was just beneficial for me to go through that with you and then understand that. So leaving the company in a position that you could lead it even better. And after two years, I I see what I see the kind of leader you you've developed into in a very short period of time being chairman of the board, and and I see where we have grown and where we are headed, and I'm just excited about it. I'm I'm excited about it because we continue to build this company and we will be around for a hundred years. I'm confident of it. And that's the biggest thing for me is, and we've done it the right way with people. We have done it the right way with people first. And that has meant the world to me seeing how people can retire here today um well off. You know, what well off means is whatever their whatever their salary or wage is today, they retire with that ESOP and the 401k. Um they're going to retire well. And that has meant the world to me. Um and that to me is much more than saying, well, what if we would have sold the private equity, or what if we would have sold that? Uh I I couldn't have lived with myself. So the the people part of it, without a doubt, has been the biggest thing for me. So thank you.

SPEAKER_01 1:28:01

Yeah. Well, boss, I've got to watch you for 13 years, and I've known you for a little longer than that. Yeah, we have. So uh personally, I just want to say thanks for everything you've done. But for our members and myself as well, I've been able to see the selflessness and commitment that you've had to Metalcraft for the last 42 years, and it's been amazing to watch. So thank you.

SPEAKER_03 1:28:31

Oh thank you, Kyle. It means the world to me. Yeah, thanks. Yeah, th thanks a lot for allowing me to do this podcast. And it's been fun. It's been great. It's been great to wrap this thing up. I'm looking forward to it. And uh yeah, thanks a lot. Yeah, it's good.