A Tradition of Innovation
The CEO of Siewert Cabinets takes his family business into the 21st century with high-tech manufacturing techniques.
By Kristin Mason
Year Founded: 1965
Shop Size: 21,000 square feet
Annual Sales: $6 million
FYI: • After setting up a new high-tech manufacturing cell, the company grew 60% in one year.
• Employees work a single shift, four 10-hour days a week.
"I started pounding nails when I was three years old…into the steps…and all the way down my parents’ hardwood staircase. Proof that I was destined for a career in woodworking is right there in my baby book,” jokes CEO Rick Siewert of Siewert Cabinet and Fixture Manufacturing, based in Minneapolis, MN. “When I was twelve, I remember helping Dad wrap burlap panels for Team Electronics out in the garage. That was Siewert Cabinets’ first commercial account,” he adds.
The company’s conference table is a glass-topped replica of a Lake Marion flatbottom boat — the originals were products of his grandfather’s vocation. As he speaks, it seems that Siewert knew very early that he would follow in his father Wayne’s footsteps.
The elder Siewert started a residential remodeling business in 1965. After “catching heat” from Minneapolis building inspectors for doing unlicensed electrical and plumbing work, Wayne Siewert spilt his business into two entities: Sieco Construction with a full complement of licensed professionals, and Siewert Cabinet and Fixture Manufacturing. The company grew from 1965 to 1995 under Siewert’s direction, embracing traditional manufacturing technology of the times — table saws, jointers, planers and the like. In 1995, the helm changed hands as Rick Siewert took over for his retiring father. By this time, the company’s defined niche was mid- to high-end tenant build-outs, and it was particularly noted for its laminate casework. A smaller percentage of SCFM’s volume was generated from the store fixturing market.
As the new CEO of a company founded upon an enduring legacy of innovation and ingenuity, Rick Siewert began to personalize his position by stressing an abiding respect for company employees and by creating a vision to move beyond traditional manufacturing methods to set a new course for the future.
The 1990s were good years for the woodworking industry in general and especially good for SCFM. As Siewert says, “Customers were banging on our doors saying, ‘We need more product,’ and there was no labor to hire. It was at a time when everyone was working but the dead. Our fax machine was our national sales manager. We would just grab the order and go.”
Siewert knew that in order to keep pace with current clients and continue to grow the overall customer base, he would need to shift his 9,000-square-foot traditional, labor-starved manufacturing shop into a high-technology plant. In order to accommodate a point-to-point machine, he started making plans to remodel and expand his facility. However, a discussion with a building contractor persuaded him otherwise, and instead Siewert ended up buying a tract of land directly across the street and building new. In a new 21,000-square-foot plant with 4,000 square feet of office space, SCFM charted a course for new, high-tech territory.
One influencing factor was that at about the same time, Siewert became involved with the Architectural Woodwork Institute. This gave him an opportunity to visit a lot of shops and see what others were doing, including the equipment they were doing it with.
In comparison, “We were antiquated,” he says. “Discovering that the viability of the company hinged on competing with these guys finally forced me to do what we did as far as setting up a manufacturing cell.
“We were starting to lose quality control, and I wanted that back,” he adds. “If I had to be on the shop floor making sure work was being done to our standards, it was awfully hard for me to run the company as well.”
For a guy who had never even had a computer sit on his desk, Siewert did a remarkable job of educating himself and his employees on the finer points of high-tech manufacturing and analyzing what was going to work for SCFM and what was not. He decided early on that he would make an alliance with Stiles Machinery for his equipment purchases and that he would “go the whole package.”
“I felt at the time that having one person to call if something didn’t work was worth a whole lot more than buying piecemeal from a bunch of different sources,” Siewert says. His purchases included a Holzma Optimat HPP 82-3800 beam saw, a Brandt Optimat KD 77C edgebander with a Ligmatech Ecomat ZHR-01 return conveyor, and a Weeke Optimat BP 140 CNC machining center. The company also has a Jonsdorf JB 10/21 boring machine, a Ritter R46 line drilling machine, a Uhling HD 3000 case clamp and a Midwest Automation glue spreader.
How did the transition to technology affect the business? Siewert agrees that it was kind of like “Fred Flintstone meets George Jetson.” In fact, it may be more akin to meeting Luke Skywalker — after acquiring the new manufacturing cell, the company experienced tremendous growth, 60 percent in one year.
However, such rapid growth did require some adjustments, Siewert says. “That 60 percent growth thing in one year? We don’t want to do that again. It was an eye-opening event. It was the pivotal point where I crossed over from being craftsman to businessman and learned a great deal about growing this company.”
Having the new equipment and developing a seamless system for processing work through the plant helped Siewert deal with one of the frustrating aspects of the commercial cabinetry industry — precise and infinitesimal conformance to client specifications. “There is a difference between going out, and going out right,” he says. “When the client sees the finished project, I want him to be able to say, ‘Yes! That’s exactly what I had in mind.’”
One way that Siewert achieves such conformance is by providing to the general contractor on tenant build-out jobs an exact model of the finished product. Not only does this help ensure a perfect fit when SCFM’s completed fixtures arrive on-site, but also it shifts the brunt of responsibility to the contractor, rather than Siewert’s installation team.
Seamless communication also is critical. “The thing that’s so hard to do is communicate clearly between the client, the person who sold the job and all the way through the organization to the people who are actually delivering product to the client’s dock,” Siewert says. “It’s one of the things we do very well.”
Another reason SCFM succeeds, according to Siewert, is that “we are always striving to be better. I think most shops want to excel, but where we differ is that we give people different tools and avenues so they can perform at their best. One of our top priorities is improving the existing work force. We feel this is key to long-term success in our industry.”
A New acquisition and a new Era
It would seem from 2002 year-end projections that Siewert indeed learned a great deal about growing his company. “We will do close to $6 million this year,” he says.
About 50 percent of that is the result of an acquisition that was negotiated in 2001. Michael Quirk, former owner of Harbinger Industries Inc., a Minneapolis-based high-end architectural millwork company, approached Siewert during June of 2001. As Quirk puts it, “I realized that Harbinger was not going to be a financially viable entity over the long term. So, I looked for someone who had skill sets that were complementary, but not redundant, and that’s where Rick came in.”
Over a series of meetings that stretched into October of 2001, the two hammered out all the details. Quirk’s primary concerns were bringing Harbinger’s work to a place that was going to service existing clients in a manner consistent with his company’s culture and, more importantly, that his employees would continue to be rewarded for their efforts in making Harbinger Industries what it was.
“We looked nationwide, but nothing we looked at appeared to be as smart as hanging out with Rick. It’s a really cool story. You don’t hear a lot in today’s business environment about people whose value system is the driving force behind getting together,” says Quirk, who now serves as national sales manager for SCFM.
Quirk brought with him 21 people: Two estimators, two project managers, one salesperson, and the balance were talented craftsmen. Quirk also brought $3 million worth of architectural millwork clients, all tenant finish work and store fixtures, with some OEM product.
When first approached, Siewert says his reaction was, “Wow, this is amazing.” At the time, SCFM was a mid- to high-end manufacturer of commercial products with modest volume in architectural millwork. Harbinger was very high- to mid-end and was heavily into the architectural products. The convergence was not just a step, but a leap towards Siewert’s goal of becoming a “single-source solution” with a broadened range of capabilities.
By absorbing Harbinger, SCFM could build anything an architect or designer could request in wood and also incorporate stone, glass, metals, leather or other specialties, as well as the basic institutional fixtures for areas like copy centers, lunchrooms and the like. A perfect example of its new ability to handle wide-ranging projects was the recently completed Fredrickson & Byron law office in downtown Minneapolis.
“It was a high-six-figure tenant finish with a lot of high-end architectural millwork and a bunch of casework behind the scenes,” says Quirk.
“It went through here really nice,” adds Siewert.
In addition to the nice meshing of complementary production strengths, both men are very proud of the culture convergence that happened between the two companies as well. “There is an inherent respect for human beings in Rick,” says Quirk. “If you take that basic value system and expand it, imagine what you can do with that in the long term...education, profit-sharing, reward for performance. There is a gamut of things you can do for your people.”
One of those “things” seems to be finding a way to overcome the peaks and valleys so characteristic of the industry. “We are working on keeping the valleys from sucking the value out of the employees and owners,” says Quirk. And the peaks? “We need to prevent them from killing everybody.”
With the acquisition, the company now is a full-service provider of millwork, casework, fixtures and furniture. About 10 percent of the business, which serves primarily a midwest market, is in store fixtures and the balance is evenly split between commercial cabinetry and architectural woodwork.
As the two men reflect on the course the company has taken so far under Siewert’s direction, Quirk adds, “Rick has taken all the stuff that is foreign to woodworking, integrated it into his culture and kept the same value system: People are important, people are important and, oh, did I mention people are important?”
Deflecting the compliment Siewert says, “I was a mediocre student. I was quiet. I was just the kid down the block who liked to pound nails.” He could add to that list, “a humble kid, destined for innovative achievements” as well. The proof is right there at Siewert Cabinet and Fixture Manufacturing.
Have something to say? Share your thoughts with us in the comments below.