Jon Haas might not be faster than a speeding bullet or able to leap tall buildings in a single bound, but this man of steel has used his business super powers to grow Haas Metal Engineering from a two-man operation in his garage to more than 200 employees operating out of facilities in Topeka, Kansas City and Denver. Specializing in the fabrication of structural and miscellaneous steel for the construction industry, HME provides estimating, project management, design, engineering, fabrication, painting and erecting services.
Superman may have x-ray vision, but Jon appears to be able to see into the future. He recognized early in his career that no matter how good of a product you may have, without a viable market, you would likely never be successful. Taking that knowledge to heart, Jon capitalized on a growing need for custom metal fabrication in the construction business and set HME on the path for constant growth.
“The vision that came into my mind was ‘I have a market that needs this product, so why not fill that need?”’ Haas said.
That mindset of growth drives his business decisions. For Jon, growth means hiring quality employees and being willing to give up a little bit of control.
“If I put myself in all positions of the company, then I limit the growth capacity of the company by my own limitations of time and ability,” Jon said.
Jon says he recently shifted his business acumen to focus more on management. His previous focus on production and keeping overhead to a minimum resulted in production outgrowing management capacity. After reading “The Goal: A Process of Ongoing Improvement” by Eliyahu M. Goldraft, Jon took a long, hard look at HME’s true bottleneck.
“What was controlling growth? It was me!” Jon said. “I didn’t want to hire estimators or marketing people because they cost me money. As a result, I was doing everything myself.”
Take the estimating department for example. It doesn’t actually produce anything. It doesn’t engineer anything. It is just overhead. However, if this department doesn’t grow, then the company can’t take on any more work. When Jon hired a full-time estimator, the company grew.
When he hired his first project manager, the company grew again.
“Each time one of those key persons was added, it took that load off of me to not be the bottleneck anymore,” Jon said.
As part of its focus on eliminating bottlenecks, HME has set itself apart from the competition by promising to produce and deliver the right materials at the right time in the exact amounts needed. By breaking the job down into manageable pieces, HME can shorten the delivery schedule by several weeks and keep the construction process moving.
Once Jon has a vision in place, he pursues that vision with a laser focus until it becomes reality. While he is good at coming up with new ideas, he admits that he needs help to put those ideas into action. He collaborates with his key people and they put the details together to make it happen.
“At HME, we have this connection and great people who understand my vision,” Jon said. “Pretty soon we are working off of each others’ ideas to create something even better than I envisioned.”
This shared goal of turning visions into reality, coupled with a US economy that also demands continuous improvement in processes to work faster, more efficiently and more economically, has everyone at HME looking for ways to maximize output. If someone sees a better way to perform a task, the company implements the change. If better equipment streamlines the process, they make the investment.
One such investment included the installation of a state-of-the-art automated Voortman cell for fabricating structural steel. Once an operator enters the design/program into the computer, this fully automated material handling system moves the material through four operations (drill, saw, coper and blaster) without any further human interaction.
Skeptics may argue that cutting out human interaction results in fewer jobs, but Production Manager Rob Mohan says in HME’s case, the opposite has happened.
“When we installed the Voortman system, it let guys who previously spent most of their time loading materials focus on more productive tasks,” Rob said. “That in turn actually increased production and created more jobs.”
Rob also credits HME with changing the way fabricators process their material and purchase their equipment. In an industry that typically doesn’t share information with the competition, Jon opened the doors and allowed competitors to observe their new equipment. Sure enough, a competitor in Pittsburg, Kan., bought the exact same system and set it up to mirror HME. Instead of being upset, Jon used that relationship to leverage and share large orders HME would never have been able to win on its own.
“Jon sees everything as an opportunity,” Rob said.
IMPERVIOUS TO LURKING PERIL
In the 20 years Jon has been growing his business, he still hasn’t encountered his kryptonite. That doesn’t mean HME hasn’t struggled through some perilous times.
“We went through several tough economic times that could have taken us under,” Jon said.
In 2003/2004 steel prices doubled over a period of three months. At that time HME was operating with its biggest backlog of work ever. The increased steel prices meant the company was losing money on every job it currently had in production.
“Our forecast showed we wouldn’t survive,” Jon said. “So I had to look at how we could dig out of that hole and find success.”
The only hope Jon saw was to go after all the new work they could get at the new prices to cancel out those losses. With production already at capacity and a bleak financial outlook staring him in the face, Jon embraced the challenge, took the risk and added a second shift.
“Maybe it was strategic brilliance, or maybe just dumb luck,” Jon said. “At a time when 30 percent of the steel fabricators in the country went bankrupt, we doubled in size, and by the end of that year, we had gotten things back up to break even.”
He attributes the success of HME to that unwillingness to maintain the status quo.
“If you are sitting still, you will get passed,” Jon said. “If you think you can just stay the same size, sooner or later the fluctuation in your workload will cause you to go under.”
While Superman receives his strength from the sun, Jon gets his corporate strength from quality employees.
Jon says they already have great leaders in accounting, project management, estimating and detailing, but they are all working at capacity. So now the focus is to grow those departments so the entire company can once again experience growth.
“When we looked at our critical mass and our bottlenecks, we discovered we needed to expand our detailing department,” Jon said. “If we can’t get drawings out, we can’t get the work to the shop.”
Finding skilled designers proved to be a difficult task. Jon knew he had to be creative to build a scalable work force. Recently, HME created a new position called “Steel Designer” that expanded the position from simply being a draftsman to incorporating a true software-based modeling system that offers multiple career paths.
Actively recruiting engineering graduates from all of the Big 12 schools, HME is currently bringing in four new engineers every six months for training.
“By creating a scalable work force, we have been able to expand at a rate that we can control versus the market of steel detailers controlling our ability to grow,” Jon said.
HME is also taking that same philosophy and incorporating it into other areas of the company. Jon says they are now targeting area high schools and technical schools to attract motivated and skilled individuals to fill available positions.
WORKING FOR THE GREATER GOOD
Superman’s greatest asset is his fierce love for the people around him; Jon shares that attribute.
He sets goals for growth and works to surpass those goals, not from the standpoint of trying to make more money, but from the aspect of delivering the best product to the customer and providing a quality work environment for employees.
“It’s as though he has a noble sales purpose,” said Larry Stocker, HME marketing manager. “Ask a typical business person why he is in business and he will probably tell you to make money. Jon’s answer would be, ‘There’s a town in Missouri called Joplin that got blown off the face of the earth by a tornado. We’re in business to build schools in Joplin so kids can go back to school.”’
Jon executes that same care in creating a comfortable work environment for his employees. Working with huge pieces of metal, large machinery, welding equipment and paint could result in a pretty uncomfortable atmosphere. However, Jon has invested in huge fans that circulate the air in the facility, regulating the temperature and venting the fumes out of the workspace. He also purchased equipment to eliminate toxic waste and create a safer facility.
Jon’s concern for the wellbeing of his employees is evident throughout the company. Rob says that is why so many employees have found careers with HME.
“We have little to no turnover,” Rob said. “The economic downturn a few years ago was tough. During that time, Jon’s number one goal was not laying anyone off. These guys depend on this company to take care of their families and he wasn’t about to let them down.”
Far from letting them down, Jon is lifting them up every chance he gets.
“Today we are handing out a bonus check to every single employee,” Rob said. “The last six months we did great— the first time in a long time. Everybody worked really hard, so from the person who sweeps the floor to the last person in the office, everyone’s going to get a check.”
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