Taking everything into account
Business students learn the keys to running a successful business from alumni who do it everyday.
At Robinson Fin Machines Inc., a flat piece of metal is transformed into something that is complex, highly efficient and often one-of-a-kind. So it should come as no surprise that the Ohio Northern University accounting students who visited the high-tech manufacturing firm in nearby Kenton, Ohio, got a lot more out of their behind-the-scenes-look at a small business than a mere field trip.
Robinson Fin manufactures folded metal parts, called fins, used to transfer heat to or from gases or liquids. The company is on the cutting edge in heat-transfer technology with products used in Sea Wolf nuclear class submarines, Formula 1® racecars and even the International Space Station. The family company is owned and operated by Sheryl (Haushalter) Sopher, BSBA ’92, and her two brothers, David Haushalter, BSBA ’92, and Mark Haushalter. Although it does business all over the world, Robinson Fin is still a small business that owes its success to key fundamental business practices. In November, Sheryl and David welcomed 27 students from Dr. Jill Christopher’s Intermediate Managerial Accounting 1 course to see how the concepts they are learning in class are used to run an industry-leading company.
“Most of the students in the courses have never been inside a manufacturing facility,” says Christopher, an associate professor of accounting. “And if you’ve never seen anything actually being produced, it’s hard to internalize the concepts that we cover in class, which have to do with analyzing and communicating the quantitative results of producing goods as well as services.”
Inside the plant, David led students on a tour of the 40,000-square-foot facility, beginning with the initial manufacturing of the fins themselves. As students watched machines stamp out sheets of fins from rolls of aluminum and copper, he spoke to them about the importance of streamlining the manufacturing process. “How do you have less work go into producing more product?” he asked. As a rhythmic ca-chunk, ca-chunk of industry echoed around him, and more and more fins were manufactured with each passing word, David’s lesson was rich with context.
“Seeing all the machines and employees really honed in on the idea that efficiency in the manufacturing business is more than faster machines; it is the collaboration of the entire business,” says Ja’Nessa Burnette, a sophomore from Akron, Ohio. “We read case studies of the manufacturing business, but until you see it in action, you can’t truly understand it.”
Robinson Fin serves a niche market of research and development applications for mechanical devices. Nearly all of the fins it makes are custom built to a client’s precise specifications. As a result, it keeps no inventory and relies heavily on the manufacturing process to stay profitable.
“The most interesting part for me was the absence of inventory. Every order they make is a special order from a client, and that gives them fixed to variable margin between 40 to 60 percent,” says Patrick T. Jeffries, a junior accounting major from Cleveland, Ohio.
A business built on custom orders will bring in higher margins, but there is another side to that coin. Custom orders tend to have less room for error and tighter deadlines, and demand excellent communication between vendor and client. To that end, David and Sherri both stressed to the students the importance of providing excellent customer service. David explained that even though students may not view manufacturing as a service industry, it absolutely is. Both he and Sheryl attribute their firm’s success to their approach to customer service. In the rare event that a mistake occurs, responding to that customer is a No. 1 priority.
“Our approach to customer service applies to our vendors as well, and you should always look at it that way,” says Sheryl. “If something happens to an order you placed with a supplier, be gracious about it. That way, when you really need them to be there for you, they will be.”
A small business depends on relationships. Robinson Fin has grown without an outside sales force because it consistently delivers quality products, and because it is committed to customer service. Internal relationships are just as strong. During the recession in 2009, employees approached management with a plan to keep the workforce intact. To prevent even one worker from being laid off, all the employees volunteered to reduce their hours. Sherri, David and Mark kept them working by “painting everything there was to paint” and performing maintenance on the facility until the orders started to come back in. In a manufacturing facility full of machines, hearing how Robinson Fin focuses first and foremost on people resonated with students.
“Their relationships with their employees, customers and suppliers are a major part of their success,” says David Janusz, a junior from Oregonia, Ohio. “I believe this is an advantage small businesses have over large corporations.”
Students also witnessed the plant’s secondary manufacturing process, where raw fin stock is cut to the client’s precise specifications using a process called electric discharge manufacturing, and learned why Robinson Fin manufacturers many of their own machines. According to David, building their own machines gives them the distinct advantage of forcing them to understand their product even better. If there was any one piece of advice that David passed onto the students that was as important as providing good customer service, it was to know your product.
“One of the topics we have discussed in our Capstone course relating to business strategy is the impact of vertical integration. Robinson Fin produces a product, but it also produces the machines and equipment to produce its product. This saves on costs in the long run, and it allows the factory to run more efficiently,” says Kendra Mayfield, a senior from Springfield, Ohio.
Many more real-world examples of business concepts were on display. From fixed and variable cost controls, to budgeting procedures, decision modeling and cost-volume-profit analysis, either David or Sheryl was able to explain how each task was accomplished, even if it was done personally by one of them.
“As an entrepreneur and a small manufacturer, you do it all. You might take the trash out some days,” says David.
This “do-whatever-it-takes” mentality is valuable in a small business, and only by seeing everything that goes into an operation like Robinson Fin can students understand what that means. This is why Sheryl and David were so excited for their visit from ONU. They want to show students what it takes so they themselves are prepared to lead one day.
“We see this as an investment in our future,” says Sheryl. “If the generation that is running the small businesses in the future doesn’t have the same mindset and the same aptitude for doing this, it won’t be as nice a world to live in. It’s our responsibility and our obligation to help in the educational process wherever we can and show students that small businesses really do play a role in the world economy and that it can be exciting work.”
Racecars and fighter jets are certainly exciting, and Robinson Fin’s role in the world economy truly cannot be overstated. Here in tiny Kenton, Ohio, a mere 15 miles from even smaller Ada, is a firm on the leading edge of an industry that contributes to the furthering of humankind’s technical boundaries. But they don’t just bend metal at Robinson Fin; when asked, they’ll transform a manufacturing facility into a classroom and deliver, once again, a one-of-a-kind product of impeccable quality.