Forging Relationships That Can Survive the Ups and Downs
Pictured left to right: CFO at Cincinnati Inc. Jeff Herman; RiskSOURCE CEO Jonathan Theders; VP of Sales and Marketing at Cincinnati Inc. Mike Seall; Vice-President of Purchasing at Gold Medal Products Dave Evans; Director of Manufacturing at Gold Medal Products Bob Wickstrom; CFO of Gold Medal Products Craig Hudson; and RiskSOURCE Account Executive Becky Lehpamer
Photography by Daniel Smyth
The clamor of shearing metal ramifies throughout the manufacturing headquarters at Gold Medal Products, an 83-year-old Cincinnati company that specializes in making and selling quality concessions equipment.
At one end of the Gold Medal facility CFO Craig Hudson stands with Mike Seall and Jeff Herman, vice president of sales and marketing and CFO, respectively, at Cincinnati Incorporated. The group is guiding their insurance agents, Jonathan Theders and Becky Lehpamer of RiskSOURCE, through manufacturing rooms and have stopped at a new fiber-optic laser cutting machine.
Like the rest of the facility, the laser cutting machine defies that old stereotype of American manufacturing in which the facilities are dark and vast and seething with oily gears while tired, low-skilled workers mill about. Rather, the laser cutting machine is remarkably pristine. Its mechanical workings are hidden beneath a vale of smooth plastic and reflective metals. The man that operates it does so through a computer terminal, and he's anything but low-skilled.
In a sea of machines that look just as clean, the laser cutting machine almost becomes uninteresting, its features receding into a litany of similarly refined surfaces. Except that it is extremely interesting, and not just to the Gold Medal executives standing there – it's interesting to the folks from Cincinnati Incorporated as well, who happened to have sold the machine to Gold Medal in 2014. That's why executives from the two companies are huddled around it, pointing out its features to representatives from the insurance agency that serves them both.
Still, none of this explains what Theders and Lehpamer are doing there. Who's ever heard of insurance agents actually taking time to understand not just what their clients produce, but how they produce it?
“Given our products and markets, we had a broad range of insurance needs,” says Herman of Cincinnati Incorporated's search for a new insurance agency in 2011. “We needed agents that could bring a range of insurance carriers to the table. We found RiskSOURCE was able to step up.”
“Gold Medal has been working with RiskSOURCE since 2013,” says Hudson. “With insurance agents, the business relationship is important, having someone who isn’t just an insurance expert but takes the time to understand what we do. Jonathan (Theders) and his staff did that. They sat down with our managers and dug into the details of our business.”
Hudson and Gold Medal have now worked with RiskSOURCE for more than a year, and they like the results. “We continue to have follow-ups about workers comp programs and safety statistics. They’ve helped us pull data and automate processes. Costs are down and we’ve got a great relationship.”
Both Hudson and Herman attest that Theders goes to extra lengths to understand the business of his clients. “Once we have that understanding we can answer questions of our underwriters before they ask them,” says Theders. “That’s how we build relationships through trust.”
The two firms – Cincinnati Incorporated and Gold Medal – are connected independent of their mutual affiliation with RiskSOURCE. Since its founding in 1898, Cincinnati Incorporated has shipped more than 31,000 machine tools across the world. Eight of them, including the aforementioned, have gone to GMP. Yet those previous seven didn’t guarantee Cincinnati Incorporated a contract on the newest one.
As with every purchase of that size, Gold Medal did its research to decide what was the best machine to buy. Perhaps there was a factory in China that made machine-cutting tools as good, or even better, than Cincinnati Incorporated. But that's not what Gold Medal found. And when the concessions company turned to its employees for their opinions on the matter, they wholeheartedly backed Cincinnati Incorporated's machines.
“We talked to our floor employees to get an idea of what they look for in machine tools, and Cincinnati Incorporated's name continued to come up. They provided the best value,” says Hudson. After thinking it over, Hudson adds that “both Cincinnati Incorporated and RiskSOURCE bring that to the table.”
That’s why Hudson works with them both. Adding value to a firm is important for staying competitive in the modern manufacturing landscape, a landscape that both Cincinnati Incorporated and Gold Medal, like many American firms, have found difficult to navigate.
“The landscape has changed dramatically in the last 15 years,” says Seall. “We’ve had to pick up the pace of product development to stay abreast of competition from Europe and Asia.”
In this Cincinnati Incorporated was helped by its relationship with Gold Medal. When installing the laser cutting machine, Gold Medal worked with Cincinnati Incorporated to optimize the cutting parameters for their stainless steel products. “By working with Gold Medal, we learned a few things that have made our products better,” says Seall.
The examples are instructive. Theders can offer a better service if he understands his clients'products and processes. More, Gold Medal can better serve its employees and customers when it knows which cutting tools create the best products. Finally, Cincinnati Incorporated can make more precise cutting tools by listening to its customers' advice on how to improve them.
Thus the fiber-optic laser cutting machine, a product made better by relationships.
That seems to be the key word in business today: relationships. Yet this flies in the face of a dogma that insists modernity is too manic for them. Consumers have so many choices and so little time that attention spans are the only commodity of value, while producers are frantically pursuing a bottommost, uniform equilibrium. The margins are minuscule and the seconds evanescent. Almost everything is made in China because China can make almost everything – and at dirt-cheap prices.
Relationships can’t be quantified so they’re useless.
But it turns out this line of thinking doesn't tell the whole story. That uniform equilibrium doesn’t really exist. There will always be changes in business, making strong relationships that can weather them more important than ever.
This is the dogma in which Theders believes. It explains why he forges strong relationships with clients. It explains why he goes to extra lengths to understand their businesses. And it explains what he’s doing at Gold Medal trying to comprehend the fiber-optic laser delivery systems that cut the cleanest edge in the industry.
“Some people are entirely focused on the bottom line, and that can be good for a short time,” says Theders. “But when it comes to long-term success it’s all about the relationships.”
For more information, call 513.779.2800 or visit www.risksource.com.