HGI Co. — Completing a Triple Play
HOW'S THIS for a five-year plan? Buy three companies--web offset, sheetfed and digital--and meld their operations, people and cultures into a cohesive whole. Along the way:
o Take Hi-Liter Graphics (acquired in 2003), in Burlington, WI, from a black-and-white nonheatset web offset shop into full-color heatset capabilities, and ultimately install the first MAN Roland Euroman 32-page, four-color web press in North America (the second globally);
o Transition Inland Graphics (acquired in 2004), of Menomonee Falls, WI, back into commercial work while still maintaining its strong position in the book printing market; and
o Expand Menomonee Falls-based Plus Digital Print (acquired in 2007) into full-color, variable data digital printing (with a Kodak NexPress 2100 digital press), Web-to-print and fulfillment to support the needs of all three customer bases.
The three operating units are now part of one corporation called HGI Co., which last year had revenues of more than $33 million. HGI employs nearly 200 workers in two plants that combined cover more than 200,000 square feet. Hi-Liter, Inland and Plus Digital Print are long-standing names with strong reputations and, therefore, are being retained, explains Craig Faust, president and CEO.
"Those brands are very well known, so it would be a mistake to give up that kind of history and recognition," adds Thomas Sikora, vice president of sales and marketing. However, utilizing the HGI structure in addition to the division names enables the company to promote itself as having all of the capabilities of the largest printers in the country, but in a smaller, more flexible package.
Doing More With Less
Sikora believes changes in the marketplace made it essential that the printer be able to offer a breadth of services. "I'm hearing from buyers that instead of a five-person staff they now have two people," he says. "They say, 'I have 10 vendors, but I can only deal with three.' We want to be one of the three, and a company that grows rather than goes away."
Building a single-source printing organization fits with Faust's background. "I grew up in a job shop," he observes. Having worked for six years with a company (The Printery) that was part of Consolidated Graphics, he had previous experience with being able to sell a wide suite of products and capabilities.
All of HGI's investments are made with an eye toward meeting the needs of the overall organization's customer base. The Euroman, for example, is used to print a range of products, including publications, catalogs, collateral materials, directories and books. It can produce a variety of formats, from slim jim, digest and standard size up to tabloid, with runs of 5,000 to 500,000 copies being practical.
Inland has an eight-color, 40? Heidelberg Speedmaster perfector press configured with roll-to-sheet capabilities that enables the company to offer a sheetfed option for some web offset work and use the same stocks across platforms to gain cost and inventory benefits.
Another 40? Speedmaster perfector, this one a 10-color, was added since the acquisition to add capacity, and the plant also has UV printing and case binding capabilities that Hi-Liter doesn't.
The latter has a six-color sheetfed press, but is primarily a web shop with a press lineup that still includes Goss Community presses and a rebuilt Hantscho Mark 6 heatset press. Its postpress operation offers perfect binding capabilities, as well as saddlestitching, ink-jet labeling and mailing services.
Compelling evidence that HGI's approach resonates in the marketplace is found in a major book deal it was able to win back from Asia. Quicker turn times were part of the equation, but Sikora says the flexibility to offer books printed digitally, as well as by sheetfed offset and heatset web, was key to making the sale. "Each of our divisions was part of that package," he notes.
This major book publisher was wooed away by Asian pricing years ago. Recently, it had been encountering increased service, delivery and communication problems.
"We didn't give up on the business and think that it was impossible to win work back from Asia, even given the initial pricing advantages," Sikora recounts.
The publisher was keen to bring the work back to the States, but the move needed to make business sense. Being able to get advanced copies produced digitally, "green" book options and a higher level of communication were parts of the winning package that HGI put together, according to Sikora.
The secrets behind the company's success are definitely not so secret. Faust believes that "it's all about people" and stresses the importance of "listening to customers." What makes the difference is how, and how well, HGI executes its business strategies and management philosophies.
"Success comes from providing added value to customers. But it has to start with the employees," the company's top exec asserts. At HGI, that means providing a comprehensive benefits package and stressing continuing education and safety. Regarding clients, HGI reps spend a lot of time listening to--not selling--them to ensure the printer can satisfy their short-term and, perhaps more importantly, long-term goals, according to Faust.
Sikora likes to refer to himself jokingly as "manufacturing's worse nightmare" in terms of pushing to meet a market segment's full range of product and service needs.
Keeping It Personable
Both technology and the human touch are used to keep a close connection between the company's bases of operation. Employees have been encouraged to interact from the beginning, with the entire Hi-Liter staff given an opportunity to tour the Inland plant at the time of the acquisition. Similarly, Inland and Plus Digital employees were bused down for the ribbon-cutting ceremony for Hi-Liter's new Euroman press. Individual visits are also made, such as a CSR from one plant spending the day at the other to see the equipment, talk with staff and share best practices.
Interaction at that level is important because normally the same salesperson and CSR retain responsibility for a client's work, regardless of which plant does the production. While there are estimators in each facility, they have access to estimate all job components to whichever platform--web, sheetfed or digital--best fits the requirements.
"We don't want anyone telling a customer, 'I can't do that. We have to send it to the other plant,' " Faust explains.
Central to making this integrated production approach practical was implementing an EFI PSI print MIS solution throughout all three operations. Close to 500 jobs a month are being processed across the company, so there are a lot of small jobs in the mix.
HGI does global scheduling and has a master scheduler, points out Ed Miglio, vice president of manufacturing. "The schedule gets updated three times a day, and we have a production meeting across both plants (via teleconferencing) each morning," he says. "All of the department managers, production people and CSRs go over what's shipping in the next five days."
Jobs are tracked from estimating through to shipping in the PSI system, so CSRs can rely on it to keep tabs on work in progress, particularly when it is being produced by the other facility, Miglio notes.
Any functions that make logical sense to extend across the whole organization--including human resources, administration, IT, prepress, quality control, maintenance, shipping and receiving--have been set up as unified departments, Faust reports. Next up is moving to a single telephone system, so when people are paged, the request will be heard throughout all the facilities.
"It's a little thing, but it has a big impact from a culture standpoint in making this one entity," the company president contends. "When a customer walks into Hi-Liter, Inland or Plus Digital, we want the experience to be very similar."
To help maintain a human touch between the facilities, members of the executive team and department heads have been designated as the HGI Group and charged with overseeing and facilitating communication between both plants by regularly spending time at each location. "We try to keep a very flat organization," Faust explains.
That is especially true when it comes to pre-media. All file processing, proofing and platemaking is handled by a single pre-media department located in the Hi-Liter facility. A new PlateRite Ultra platesetter from Screen (USA) was added in an upgrade to the department. Plates are delivered to the Inland plant via a shuttle, and the company says it can get a new plate back on-press within an hour.
It's more than just lip service when Faust says, "It's about people." He has made human resources a strategic function at HGI because of how integral the employees are to the firm's success. HR policies and procedures should be about more than just keeping a company out of trouble, he contends, and be part of its long-term strategy. As a result, Amy Turner, vice president of human resources, is involved in all executive activities.
All for One, One for All
When it comes to the employees, everything is kept identical between the divisions. All staff members are covered by exactly the same benefits package, work rules, review structure, etc. To keep everyone informed, quarterly update meetings covering sales, financial, manufacturing and human resource topics are held during normal work hours for all three shifts at both locations. When quarterly bonuses are distributed, everyone gets the exact same amount.
"It's everybody pulling together as one team--from the front desk through to job delivery," Faust says. "We want to instill an entrepreneurial spirit."
The same group does each of the six (three shifts, two plants) quarterly update presentations. Angela Damon, vice president of finance, is part of the presentation team and an HGI Group member. "Every meeting has the same format, so we've been showing employees KPI (Key Performance Indicators) data for five years," Damon notes. "We make sure all attendees understand what they are seeing to help promote engagement in our plans."
The company's menu of employee benefits is too long to list in whole. Some highlights are a wellness program with paid onsite health risk assessments and counseling, health reimbursement accounts, and reimbursement for help with quitting smoking or for joining a health club or weight loss program.
"The health risk assessment program has made a big difference for some employees because we've caught things early," Turner says. "Full-time, flex force and spouses are eligible."
Continuing education is driven through every aspect of the company, but especially via its recently created HGI University program. It is designed to achieve a combination of future talent building and sharing expertise and best practices. Subjects addressed include the work ethic, printing basics, financials, attitude and much more.
A larger goal of the program is to develop leaders within the company, Turner adds. "It's one thing to learn the skills to run a press. It's another to be an overall valuable person to the company and the community."
For the present, HGI's position as a market leader has already been assured by bringing together the right combination of production platform, business strategy and talented people. PI
Meet the Press
With the generous cooperation of HGI, the details of its Euroman web press installation were recently shared with printers from across the country in an event hosted by MAN Roland and vendors of other systems used in this configuration. Attendees heard presentations on the technologies that combine to give the press its production flexibility and performance, then spent a morning in HGI's facility getting an up-close look at the machine in production.
This 32-page, 4x4 cylinder configuration press has a cylinder circumference from 43? to 49.6? and operates at 35,000 revolutions per hour. MAN Roland says it is a "customer-designed" solution targeted to printers serving markets that require format and product flexibility for medium run lengths. Helping to speed makereadies are the Power Plate Loading system and a simplified folder (compared to the Lithoman) that has a longitudinal adjustable former.
The Euroman is designed to take up less space, as evidenced by Hi-Liter being able to squeeze it into a lengthwise span of just 120 feet. Its configuration includes a MEGTEC Systems Dual-Dry TNV dryer and color control technology from QuadTech Inc.
Hi-Liter dedicated the press to Glenn Hintz, former owner of the company.