Thriving in the Fourth Generation
The longevity is worth mentioning when any company stays in business for so long, but it is especially impressive when a family-owned business is still thriving in its fourth generation.
You can be sure that nearly a century of success for a company means good leadership, growth and innovation.
IN THE EARLY 1920s Ernest-Spencer began its operations by designing and building grain elevators and feed mills for local agricultural businesses. Seeing a demand for parts fabrication, it established the metal working business in 1984, which eventually led to a powder coating operation as well. With state-of-art technology and machinery, Ernest-Spencer is able to provide a turnkey solution for parts fabrication and assembly.
Ernest-Spencer made news in 2014 with Dynamarine, a division of the company manufacturing airboats right here in the middle of Kansas. Today the company is making its mark through a partnership with Terramac to produce customized rubber track crawler carriers—6 or 9-ton vehicles built to carry big loads on rough terrain.
VERSATILITY BY DESIGN
Ernest-Spencer employs more than 200 people at three Kansas locations, each with their own role in the overall business. The corporate office in Meriden handles high volume manufacturing as well as large custom manufacturing components. Ottawa is home to the powder coat painting division. The South Topeka location is focused on the manufacturing of operator cabs for vehicles and sheet metal work. Each division is a piece of the whole, with their own niche. Neal Spencer, president and CEO, notes that there is also overlap between the locations.
“It makes us very versatile,” Spencer said. “Each piece fills a niche and does something different, but they are capable of doing the same work. We can do essentially the same work in our Topeka location that we do in Meriden, and our Ottawa location can support our Topeka location.”
This year, Ernest-Spencerexpects to build 110 units of customized rubber track crawler carriers for Terramac.
Many of Ernest-Spencer’s employees are cross-trained to work at multiple locations, which allows the company to move people back and forth when one plant is busier than another to maximize efficiency and production. Managers rotate through all three locations as well so they understand the specifics of each plant.
“This strategy enables us to meet customer needs more quickly, and it means that we have a back-up plan in place if one location is affected by a situation such as weather,” Spencer said. “If a tornado takes one location out, Ernest-Spencer can still do the job you hired us to do.”
The company’s versatility and ability to plan for contingencies is a huge component of its success. Just as crucial is Spencer’s philosophy of seizing opportunities when they arise and building relationships with strategic partners. The acquisition of the Topeka location is a perfect example of this philosophy in action.
Looking at ways to grow the company and meet additional customer demands, Ernest-Spencer acquired Topeka Metal Specialties in 2016. They purchased its facility, equipment, absorbed its resources and folded their staff into Ernest-Spencer’s operations.
“A lot of the growth we’ve seen in the last few years is a direct result of that acquisition,” Spencer said. “We not only retained most of the staff, we also kept most of that company’s customers and blended the new location into the fabric of our organization.”
Much of Ernest-Spencer’s success can be credited to the employees who bring their A-game to work every day, according to Neil Spencer.
RELATIONSHIPS FOR GROWTH
Spencer says he believes that trust and relationships are key to business success. Many of those relationships lead to even more opportunities down the road.
His relationship with the general manager of Topeka Metal Specialties led to the acquisition of that company. That purchase allowed Ernest-Spencer to build new relationships with customers that had done business with Topeka Metal Specialties. One of those customers was Terramac, another family-owned business. Topeka Metal Specialties had been making small operator cabs for Terramac. As Ernest-Spencer chatted with the company, a new partnership formed, with new ideas.
“They offered us an opportunity to build these vehicles—crawler carriers—complete, the whole thing,” Spencer said. “After some thinking and discussion, I agreed to take on the job. They trained us on assembly and mechanics, and we started building custom vehicles.”
Work on the crawler carriers began in January of 2018. Ernest-Spencer built 45 units last year, and by the end of 2019 the company will have built 110 more. It is a perfect partnership—Ernest-Spencer builds the machines, while Terramac provides the engineering, sales and aftermarket support.
“Only a handful of shops in the country make these vehicles and we are proud to be one of them,” Spencer said.
Spencer sees the acquisition of the Topeka site and partnership with Terramac as a true game changer that sets Ernest-Spencer apart from its competition, and he expects about 25 percent more growth next year in the manufacturing of custom vehicles alone
“Our company is almost 100 years old and I’m the fourth generation owner. Every one of those other generations had a moment in their tenure that was a company-defining moment,” said Spencer. “For me, starting with the acquisition of the Topeka site and then partnering with Terramac changed the trajectory of our company a bit. Now we’re not just the guy that makes metal parts, we’re also a company that can provide full line assembly services, mechanics on staff and more. It’s created a niche for us that wasn’t there before.”
CULTURE OF EXCELLENCE
Spencer credits much of the company’s success to the employees who bring their A-game to work every day.
We have a lot of long term employees,” Spencer said, “folks who have been here for decades. We want people to stick around and feel fulfilled here.”
“I want my employees to show up, work hard, continue to learn and keep improving,” Spencer said.
Spencer says he believes that it is his job, and that of his managers, to help staff succeed at their jobs, to empower them and support their growth in the company. Ernest-Spencer offers a fair wage and good benefits, of course, but it also recognizes milestones and provides staff with opportunities to collaborate and enjoy spending time with each other. A good organizational culture means that employees feel that they are part of the success of the company and are invested in its future. Spencer prizes a strong work ethic in his staff, and he loves motivating others to be excited about the business and the possibilities.
“I want my employees to show up, work hard, continue to learn and keep improving,” Spencer said. “I love the work I do, and I want our staff to feel the same way. Each day brings new opportunities to work on tremendous business potentials, it’s never boring.”
Neal Spencer, president and CEO of Ernest-Spencer, plans to focus inorganic growth by investing in new technology that will maximize production for existing customers.
WHAT’S NEXT?
Ernest-Spencer will focus on organic growth with existing customers by adding new technology, such as automation and robotics, to maximize production using existing personnel and infrastructure.
“Technology is a huge investment,” Spencer said. “We’re investing millions in the future.”If history repeats itself, this investment will lead to more growth, more opportunity, and a continuing legacy of quality and innovation for Ernest-Spencer.
