5/2/2016 12:28:00 AM
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Ogletree at SFA: How to Combine 2 Companies
“Has any employee in here had a good experience with your company being acquired?” Buddy Ogletree of Field asked the Southwestern Fastener Association.
No one raised their hands to indicate they enjoyed an acquisition.
Ogletree had 16 years in the fastener industry when Field of Rockford, IL, acquired HR Logistics – a Tyler, TX, distributor in July of 2014.
HR Logistics was not originally seeking an acquirer. They were looking to transition out Ray Robinson – who founded HR in 1972. “Business was good for us,” Ogletree recalled. “Business was extremely good for us. We were not looking to sell.’
HR sales had grown 155% in four years.
When contacted by a business broker, the Texas distributor didn’t know who the Illinois distributor was.
Early meetings revealed HR Logistics and Field had a “shared vision,” Ogletree recalled. Both had a similar customer-oriented culture.
HR Logistics’ was a less formal situation of staff “coming in and doing a good job,” rather than Field’s formal ‘in-writing’ program. “We were all good people, but the strategy wasn’t ‘displayed’,” Ogletree explained.
Speaking to the spring 2016 SFA conference, Ogletree declared the 2014 acquisition a success and said it has improved the former HR Logistics.
Upon acquisition, HR Logistics employees were understandably leery, Ogletree acknowledged. Would Field layoff a large number of HR employees? Would Field move the distribution center from the east Texas town of Tyler 100 miles to the Dallas/Fort Worth Metroplex? Would there be new executives?
Ogletree said the first step was for HR Logistics and Field to “develop a trust.”
That began with leaders during the negotiations. “I early on recognized as right thing to do. We were similar – lean. They had people in place” for growth, Ogletree explained.
Despite similarities, upon acquisition there were bound to be changes.
“Change is a process,” Ogletree said. “Organizational change occurs when a company makes a transition from its current to some desired future state.”
The transition started with small projects to train HR team members. Field has a process of teams making decisions.
Field initiated more training – including visits to manufacturers from cold heading to stamping. The training means employees “don’t have to ask as many questions,” Ogletree said. With training they can understand what hydrogen embrittlement is.
HR teams began meeting in Field’s “huddle” style of quick, standup sessions.
Among the changes was finding ways to reduce work. As an example, Ogletree cited some employees had been spending two hours per week entering orders.
“Is there a better way to do? With a new automatic ordering, two hours was cut to two minutes.”
There is more measurement of everything after the acquisition. “Why do you measure things? You are trying to improve,” Ogletree answered his question.
There were a few bumps in the transition, Ogletree acknowledged. Soon after the acquisition, Field’s principles were displayed on the a HR Logistics wall – including the word “fun.” An unknown HR employee crossed out the “fun” and questioned when work would become “fun.”
Employees did find multiple ways they liked Field, such as the emphasis on community involvement and work/life balance.
The addition of a $400 ping pong table was the “greatest thing Field did. Those little things help when (an employee is) staying late.”
Field has won awards from Great Places to Work, Ogletree noted.
But over time, Ogletree estimates that an 80% majority of HR employees are happy with being part of Field and “the other 20% were not pulling against it.”
Ultimately, what made the transition work Ogletree said was Field and HR having “the same core values. It is easier if we come in with the same core values.”
The combined Field and HR operations under the Field name have a goal of growing from $63 million company to $100 million. “We have the facilities. We have the software,” Ogletree told SFA. “We’re looking to continue to expand.” Web: FieldFastener.com
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