Keep your powder dry

When tool and die maker Michael Ward Sr. started Ward Manufacturing Co. in 1936, one principle gave the business a solid foundation: Keep your powder dry.

That"s according to the founder"s grandson, Tom Ward, vice president of the Evanston, Ill., company, now under its third generation of management. The stamping house got its start making relay frames for the railroads, and the company still stamps many of those same parts today. You could call our growth conservative, Ward said. We don"t owe a dollar; we"re debt-free. Put another way, its powder is dry.

If the story stopped here, Ward Manufacturing would seem like a slow-moving dinosaur of a company, right? Conservative growth doesn"t seem to gel at all with the fast-moving global economy.

But look at the company"s equipment and the story changes. Since 1997 Ward has purchased 10 new presses; that"s right, 10this in a company with only 45 employees. In a sector where it"s not uncommon to see 30-year-old machines banging away on the floor, the company invested in, among other things, a bank of AIDA servo-driven mechanical presses. And just last month management got together to discuss the possibility of eliminating some older presses and freeing up space for a fewagain, brand-newpieces of fabricating equipment to expand their overall capabilities.

So, where"s the conservative growth?

Ward called all these acquisitions conservative because for every piece of equipment the company paid cold, hard cash, with no multimillion-dollar financing. The cash came from years of frugality. Put simply, the company did not live beyond its means. He contrasted this with a lot of what happened earlier this decade, particularly in sectors like computers and telecommunications, when OEMs offered manufacturers a plethora of relatively straightforward work at very high volumes. The catch? Some of these shops had to buy 10 new machines, open a shop in Mexico, and borrow a million dollars, Ward said. Shortly thereafter, the OEMs saw better prices overseas, and the domestic well for work ran dry fast. Carrying huge debt, stamping houses had no choice but to shutter their doors for good.

Saving money alone wouldn"t have sustained the kind of success Ward had seen in recent years, though. The company had some innovative thinking up its sleevesand much of that came from several die designers who had unique ideas about tooling. Specialized deep draws and other complex work became Ward Manufacturing"s bread and butter. Thanks to in-house talent, seemingly impossible designs became possible, said Ward, and customers reaped the rewards.

With that talent, company managers take jobs others can"t, carving a healthy niche around very complex, high-touch, high-value parts. As Ward put it, the company focuses on China-unfriendly jobs.

From my perspective, Ward exemplifies the future of a lot of stateside manufacturing: small runs, complex work, innovative thinking. Many will run small but incredibly progressive businesses with a focus on quick turnaround, satisfying customers from a diverse base that"s stable and, again, very China-unfriendly.

As for the stamping house in Evanston, Ill., keeping powder dry has kept work coming through Ward"s doors since 1936, and, most important, it"s given the company plenty of ammunition for whatever lies ahead.