When its parent company split its business, Decatur 's Automatic Screw Machine Products managed to increase revenue by trusting and empowering its employees.

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DAILY Photo by Gary Cosby Jr.
Automatic SMP says employee
power is providing double digit
growth. |
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"We've grown the business about 40 percent since the split," said Mike Selby, president. "We've redesigned or reinvented our entire company and our infrastructure."
According to Max Shelton, vice president of administration and an employee for more than 35 years, worker-driven implementations are directly responsible for the company's recent growth.
"I've said all along our most valuable asset is our people," Shelton said.
He and Selby said they challenged employees in 2003 to double-digit growth every year for five years. Instead of telling the workers how to meet that goal, they asked them. Then they dangled a carrot: a share of the profits.
Finding business
The employees created processes and systems, changing everything from the paint to the name. Now called Automatic SMP, or specialty machine products, the company's empowered employees got results.
"We received three recent and critical awards," Shelton said.
The awards are actually approvals from different companies, each enabling Automatic to grow.
First, Goodrich Cargo Systems named Automatic one of its certified suppliers. Goodrich makes material handling systems for airplanes, and it chose Automatic to make certain parts.
"We're the primary go-to for a lot of small, precision components," Shelton said.
Next, ThyssenKrupp Elevator presented Automatic with its Golden Gear Award. Shelton said ThyssenKrupp guaranteed to purchase more parts from Automatic as part of this award.
"It kind of gives us first shot," he said.
The third award was from NASA Marshall Space Flight Center in Huntsville . Shelton said this award says the most about Automatic's focus.
"We provide precision machine parts for life critical, life-saving industries," he said.
Marshall , after auditing the company for more than 18 months, approved Automatic for flight critical missions, saying the company's quality is "safety and mission critical."
"This is a definite stepping stone in our future and a key element in our goal of double digit growth," Shelton said.
Automatic is now an approved supplier to the space program via Marshall 's certification.
Safety and reliability
Rick Roff, communications at Boeing Commercial Airplanes, and George Buswell, quality at Boeing Commercial Airplanes, said certifications like those earned by Automatic are necessary and critical.
"Our stringent standard for quality throughout the supply chain helps ensure that we have aircraft with the highest levels of safety and reliability in design and production," Roff said.
He said industries like the commercial airplane business are "life critical."
A flawed machine part in the airline, space, elevator or similar industry could mean loss of life. The certifications ensure safety for the end user and limited liability for all levels of manufacturing.
Expansion
Roff said quality approval also leads to expanded business. Boeing has 440 suppliers in Alabama and paid them a combined total of $540 million during the last 12 months.
Automatic has been an approved supplier at Boeing Commercial Airplane for more than 30 years, according to Selby.
Since 1987 Automatic concentrated on distribution under President Stan Belsky. Belsky chose distribution over manufacturing to avoid the ill effects of a lagging airplane industry, a long time company gold mine.
Automatic's manufacturing segment served to support that distribution.
Automatic grew from about $9 million to about $55 million in revenue in that format. Parent company Lawson Products Inc. recognized the potential and separated the two groups, sending Assembly Component Systems Inc., the distribution segment, to Kansas .
Lawson directed Automatic to focus now on manufacturing.
Automatic brought in Selby, drawing on his decades of manufacturing experience with what he called "world class companies like Parker-Hannifin," the world leader in motion and control technologies and systems.
He used his experience and knowledge of "lean" or "just-in-time" manufacturing to focus Automatic's employees on efficiency.
With an average tenure of 17 years, Selby said he knew he had a group that wanted Automatic to succeed. Shelton said Selby put every employee in classrooms.
Making it better
"He gathered all the employees and got them involved in making it better," Shelton said. "You soon had all the employees buying into the new mentality and feeling ownership in the company."
Shelton said everything became goal and achievement oriented. He said Automatic reached for maximum efficiency.
Shelton said Automatic had no sales force, so they added two salaried salespeople and a few other employees.
They now have more than 100 employees and are slowly expanding.
But headcount is not the ultimate measure of success.
Higher profits and greater efficiency are, he said.
And, according to Shelton , the company achieves its goals by trusting its employees.
Automatic's last step when pitching itself to a potential customer is to invite the customer in for a tour and a talk with any and all employees.
"If we get our customers in to visit, we're almost there," Shelton said.
"They can't buy from you until they know you." |