Below is the full interview between Mike Lessiter, editor of Farm Equipment, and Susie Veatch and Jon Kinzenbaw of Kinze Manufacturing. For Veatch and her father Kinzenbaw, the move from local repair shop to global manufacturer has been a rewarding learning experience — but not one without its challenges, including the John Deere lawsuit that could have squeezed them out of the planter business.
Mike Lessiter: When someone says, what does Kinze Manufacturing do? How would you answer that question?
Jon Kinzenbaw: Well, I think the standard would be that we build agricultural equipment and then we go beyond that in that we build grain carts and we build planters.
We pioneered the grain cart concept in 1971, and when I go down the road and I see all these other grain carts out there, it’s because the grain cart is not what you’d call terribly difficult to build one… they do the same thing, but I can look at them and say, “you know, that was the first grain cart that had large high flotation tires and it unloaded itself in less than 3 minutes onto a truck.” It was the go between from the combine to the truck and that concept caught on and the first year or two it was well that’ll never work, that pulls too hard, on and on of that, to within 5 years everybody was starting to need one. So, the grain cart was where it began.
And then the second one would be the planter where nobody folded a planter, everybody loaded it on a trailer, if it got beyond an 8-row they loaded it on a trailer and hauled it end-ways. So we showed the whole industry, including farmers, how to fold a planter and that’s where things took off.
Mike Lessiter: What year was that?
Jon Kinzenbaw: That was ’75 when I built the first planter. ’71 on the first grain cart, ’75 on the first planters and then from there it was other models.
Mike Lessiter: And the first — the welding business got off the ground in what year was that?
Jon Kinzenbaw: That was December 10, 1965. Welding and Repair.
Mike Lessiter: Take us back and tell us about that day and what led up to you hanging out your own focus.
Jon Kinzenbaw: I’ve come from the Army, I wanted to run a business and my first thought was to probably something ag, but I like to fix machinery, weld it, repair it, overhaul it, whatever it needed. So, our goal was to open sometime in December. We started in October and worked through November getting the building ready, bought an old building for $2,000. I had $3500 worth of borrowed money that I bought tools and equipment with, and we were ready to open up on the 11th of December but a good local fellow — his wife brought in a loader frame that was broken and begged me to fix it because he needed it to do chores the next morning. So I did a $15 weld job on December the 10th, 1965 on a ticket.
Mike Lessiter: So, when you started that out, were you thinking it was going to be kind of job shop to take what work comes in or were you going to focus on a certain area?
Jon Kinzenbaw: You know, it kind of was interesting how it slipped up on me because my first thought, the year prior, I talked to my uncle about opening a hardware store because I liked bolts and hardware and log chains and #9 wire and farmer supplies. And I was even missing it, because my real expertise was probably just to take something, look at it and fix it. And it didn’t dawn on anybody that I had that special knack to do that — so I just stumbled into it and changed the direction of that fall to welding and repair and we didn’t do any advertising, we just got ready and opened the doors and we never had a day we didn’t have something to do.
Mike Lessiter: What kind of work were you doing in those days?
Jon Kinzenbaw: Break a wagon tongue, you bring it in and I’d fix it. If he lost a wheel off a wagon I might put a new spindle in it. If he bent something up, I’d straighten it out and repair it. Then it led to overhauls and working on engines and diesel engines and I worked on trucks, tractors, anything that had an engine and needed mechanical work.
Real first product was actually repowering John Deere tractors and we were putting — we were taking out 130 hp engine and putting in the Detroit Diesel which is about 300 horse. And we could go out and really make a plow move. And we got to phone anhydrous ammonia for a little local fertilizer dealer right there across the road from me and we got to doing that and I needed a better toolbar and so I built a pair of 30-foot toolbars. They were 13 knife, 30-foot wide and then we started building the wagons to pull behind it. We had a 2,000 gallon on an anhydrous wagon, which was unheard of back that day was. A thousand was plenty but when we got that kind of power we put 2,000 gallon. So the anhydrous bar was kind of the first — followed the repower then the anhydrous bar we built lots of those. And then along come the adjustable whip plow in ’71 and after I got that done I licensed it to VMI and then that fall I had to finish up a wagon for a local guy and that was the first grain cart. We took it out to haul corn away from the combine.
Mike Lessiter: Susie, what comes to mind when we think about the earliest memories you have of the company?
Susie Veatch: I probably wouldn’t go back to one specific memory just so much as kids we were always with my dad when he was doing things, whether it was the weekend or week night and he’d go out and get the bulldozer or go get in a tractor and we just spent hours riding with him. I know he tells the story about making me a wagon when I was a little girl and he wasn’t making it quite fast enough to suit me because in my mind I just thought he’d go get the parts and there it would be and we’d have a wagon, not something that was a project.
Jon Kinzenbaw: I got the parts all made and I sent her after the tires, which were the little tires off of a row marker. And she rolled one of them back and I carried one and I had bent the pan out for this little wagon and I bent the fenders and I had the front end and the tailgate and had some tubbing. And she said Dad, where is this wagon we’re building? She couldn’t see it. We took it home and finished it.
Susie Veatch: It wasn’t quite fast enough. I wanted to ride in it and it took a long time to have it be built.
Jon Kinzenbaw: She thought that building a wagon was — it was there, seeing it from the minute she thought about it, but it didn’t exist. Had to get through that concept.
Susie Veatch: Yeah, of course I was only probably what, 7 if even that. Just didn’t understand the process and how things worked and my end goal was to go for a ride. So, I have a lot of memories of — we obviously as a family whenever we were out on we’d stop by and we’d see a dealer and we’d go to farm shows. The business was just very much a part of our lives, and so I’ve always known it as far as being around it since I was a little kid and always enjoyed the people that we met, the people we interacted with as a result of being a part of the business.
Mike Lessiter: Jon, when did you know that you had a serious enterprise that was going to really change the ag equipment world? When did that start to come into focus for you personally?
Jon Kinzenbaw: Probably in the late 70s after I was privileged to pay some income tax. I started with $3,500, 9 years later I was $100,000 in debt and I hadn’t paid any income tax yet. And then in the 10th year I made enough money to pay taxes. From that point on it took off and that 10th year would have been ’75 and things started to grow from the planter, more wagons, we had some other little products in there, spray cart, and we quit doing the repowering at that point and concentrated on manufacturing planters and wagons.
Mike Lessiter: So on that 10-year mark you were profitable, you were thinking we can put the pedal down and make this company into something special.
Jon Kinzenbaw: Well, I guess it — if you don’t have profit, the rest of it goes away pretty fast. And the only reason I lasted 9 years without making any money was because the banker was kind of locked in. The banker was a good friend of my dad and knew Dad was honest and it never occurred to him to have Dad cosign the note. So, I borrowed that first on my signature and we kept going after that. And I’d go back and borrow more and sign it and kept going. There was a point in there where the banker was scratching his head thinking, I don’t know how we’re going to get this money back — but he didn’t dare pull the plug or he knew he’d lose it all. So he toughed it out.
Mike Lessiter: On the manufacturing side, the key milestones where you made significant investment in facilities and tools. Could you kind of run through that for me when you made those big investments?
Jon Kinzenbaw: Well, the first thing I needed was a sheer and a brake because I had been borrowing and running, borrowing, using, a couple of other guys machined equipment and one guy fabricated the wagon pieces and charged me way too much and I borrowed another guy’s and built it myself, but he was 50 miles away. And so then I decided I had to have a sheer and a brake so I set out to build them, I couldn’t afford to buy them.
So I built a 12-foot sheer that would cut at least ¼ inch plate and ended up finding out after I got it built that it was tough enough to cut ½ inch plate. So I had the sheer. And then things started to go and then I didn’t have time to build the press brake, so I bought a little 100-ton Wisconsin Forcemaster press brake and it cost me — I’m rusty now on the numbers, but I suppose it cost me 40 or 50,000, which I could borrow that at that time and it was also 12-foot long and I was out in the plant the other day and we’re still using it — 40-plus years old.
One of the things that I did, I knew some of the story of old Henry Ford and his assembly line and I knew when I was building grain carts, I’d back it in and build the frame. And then I’d pull it outside and build another frame. I kept doing that. And then we’d bring them back in and put the axle under it or whatever. And then we set the tub on it. And then we put the augers in it. The time lost, if that work station had to pull it outside and by the time they pulled the next one in they lost that time, we’re going to bet they aren’t going to gain it back at the end of the day because they didn’t have to.
So, when it occurred to me that we could put that on a wench, I laid a piece of angle iron on the floor with the point up and made clips on it and I’d bolt that to the floor every season. And we had a steel roller on the hitch of the frame, and on the back I had a pair of heavy duty, hard rubber tires like you would have on a wagon that went around the plant, factory rollers. And we started wenching that through and we’d hook one behind the other. And that steel roller grounded that frame so it would come past the guy welding and he could do his job and then it’d go on. And if he didn’t keep up in getting down the line too far, the guys says hurry up, get done, I want…you know. And that put the urgency to getting it done and we doubled our production just overnight. Made a game out if and the guys were hustling in a hurry.
Susie Veatch: That’s one thing that surprises some people that come to Kinze that have never been there before. Today when somebody comes and tours they get to go through our innovation center and see the history we’re talking about as well as the new things that we have. We’re continuing that on, that’s not ending because innovation is one of the key drivers of who we are. And then when they go up into the factory and see the state of the art technology that we have applied there. We’ve brought in a lot of great people that come from outside of ag, where maybe manufacturing was already ahead of ag and they’d be able to apply core principles to what we’re doing to make us very efficient in what we do.
And when you think about a planter, how complex it is, where years ago they used to go down the line one right after the other where they were batch built and one was essentially like the next and then the next. And then you’d run another batch of like things. Well today, whether it’s a 4900 or a 3600, whatever is going, being built, the one behind it is probably going to be very different than the one in front of it. And so we’ve changed a lot of our processes to be able to do more of what we call cellular building or building it to order as needed vs just building it at a base level and then the dealer having to do a lot of assembly on the other end. Because dealers want to be able to take that planter and do very little to it and deliver so it’s ready to go, and so we’ve advanced a lot over the years in our abilities to now build a very complex product in multiple, many, many different configurations and have it pretty much built to the end customer’s use when it ships on a truck to go to the dealer.
Jon Kinzenbaw: If you thought about it, you know the dealer might sell 2, 3 or 4 of a certain model. Every year it’s a learning curve to assemble it and we made changes. But if we put it together at the factory, we know that we can do them a lot faster because we do them over, over and over again. And so we can save the dealer a lot of money by assembling it for him, unless he’s any more anxious to sell it because he doesn’t have to put 3 weeks work into it putting it together. And we didn’t end up with a lot of things put together wrong. And the more we can do… We catered more and more to that. This big planter over here that came in is 60 feet wide and it has 47 rows on it, and we brought it in here on one load, just like you see it, it was all assembled. And that was unheard of 30 years ago, 20 years ago.
Mike Lessiter: You guys approach manufacturing differently than much of the rest of the industry, right?
Susie Veatch: We’re very vertically integrated. We’ve done that for many years and not all of our competitors do that and that’s one thing that makes our product stand apart. But yeah, there’s a lot of things that we do and that we do right here in the U.S., because it’s important to us as much as we can. Obviously you have to make good business decisions and good as a sense about what we do, but for the most part we bring in the raw steel, we fabricate it, we weld it and we paint it, we assemble it and put it together and ship it. So it’s exciting to be able to follow our product through from the level of raw steel that gets shipped in on a truck and then see it go through that factory process.
Mike Lessiter: And you have the control over the quality and the delivery, all those things are part of the philosophy behind that.
Susie Veatch: Absolutely, because that’s part of what the Kinze brand is known for, is the quality and the durability. It’s interesting, I’ve traveled around the world a lot, especially in the last 10 years as we’re growing our global business, and it doesn’t matter if I talk to a farmer in the Ukraine or Russia or in Williamsburg, Iowa — the business of farming is very similar, how they practice it may vary in some degree, but as far as how they’re getting the seed in the ground is all pretty much the same and they say what stands apart about Kinze is it’s a durable product and it’s easy to use and of course it makes them productive and gets their crop in the ground in the narrow window of time that a farmer has to get the crop in the ground. And he mentioned the rear fold planter, there’s some of those early planters that are still out there being used and I’m sure back then you never would have dreamed that that many years we’d still have those products out there, but they’re just that well built.
Jon Kinzenbaw: 42 years, 41 years, 40 years, and in the last 2 days I’ve talked to probably one guy back near home and another guy, 2 or 3 guys here, mentioned the rear folds. And you think it’s unheard of something that old.
Mike Lessiter: One of things that in talking about the history and I’m going to encourage everyone who’s paying attention to this podcast to read your book because it’s outstanding and really a great American story.
Susie Veatch: Thank you.
Mike Lessiter: What are the biggest defining moments of the history of Kinze Manufacturing?
Jon Kinzenbaw: I think the first thing comes to mind was the day that I met up with a banker who was actually the second bank, I had outgrown the little bank and had been above and beyond his abilities for several years and I was trying to borrow from two different banks. And finally a local fellow who was a friend of mine and was very well-known and had a lot of backing said well yeah, I’ll co-sign your note, go back to your little bank borrow and I’ll co-sign it. When I got to the bank that next morning, I told the banker what I wanted to do and he says, “you know, if he’s got confidence like that in you, we probably should, too. We can go ahead and loan you that money and not get him involved.” And I said, “well, I thought you were against your limits.” Well, we can send that over to the big bank called Correspondent Banking. And that was the end of my financial — I never ever after that ever went looking for money, begged for money ever, where in that first 10 years every time I turned around I was trying to figure out where I could borrow more money. I borrowed from local farmers a little bit, a few thousand here and there, and I borrowed from one old guy south of town and when I went back and paid him 3 years later with interest he cried, he says nobody ever pays me back. Everybody things it’s their right to rob him I guess. And I had another lady in Illinois that loaned me some money because her husband had died doing some of the repower work. She loaned me a little money and another old farmer south of town loaned me money, and it was really fun to pay them back. But that was the first thing that comes to mind was to solve the financial needs, but you can’t just go out and borrow money and throw money at it, you have to have it ready to go and I didn’t borrow money to waste it, I borrowed money to make it work. So that was the first defining moment. And that was 1974.
The next one would have been probably ’84 when it occurred to me to raise a planter and rotate it. Just opened it wide open where I could put 15-inch rows on a 30-inch planter, 12-row planter could plant 23 rows on beans of 15s, the 16-row planter could plant 31 rows or 32 now, 15s on beans and 30 on corn and that was the biggy on product.
I remember having a bunch of 6-row planters welded up and ready to paint and we were trying — we painted the 4 and 6-row planters the year before we painted them black, the frame black and put — we could put our unit on it or whoever, but our row unit was black. So we tried a black frame and it just chalky and looked terrible. So I’m scratching my head trying to decide what to do and should we paint it green, do we paint it red, what color? And one of the guys said, “well, you know, our wagon is very accepted and successful as blue, why don’t you paint them blue.” And just, that quick, I said “hang them on the line, paint them blue.” And we’ve never looked back. And I think right now if you took that planter out there and painted it any other color it’d look terrible. If there’s anything that I would say we have to sell besides our quality and all that is the name and the blue color.
Mike Lessiter: One of the pieces of the book that was inspiring is you had some tough times and big business was staring you down and you had the faith and the courage to move forward when other people might have caved in or walked away. What can you tell us about what that time was like?
Jon Kinzenbaw: Well I think that I had a good attorney representing me in a John Deere battle and they were out to put us out of business. They didn’t like the idea that I was encroaching on their planter, their product line, and all of a sudden I was buying too many of their row units. We had a court order against them to sell, they sold them to us for 2 years and I started putting them on by the thousands and they had another just totally cut us off. And you can read all about that in there. So then we built our own row unit and got that off the ground.
Then we had another battle where a company copied our razor rotate and they weren’t very successful with it, but they convinced the judge, who had no idea what a patent was — let alone the difference — and she let them off the hook and so they ended up with their own rotating planter. It didn’t pan out, it was not what the farmer wanted. So the next thing we knew we had a company that said haul us all the way out east after this book was written and we went through a major battle over a stupid vacuum meter that we copied, quite frankly, we copied the old Monosem technology, which had already been around for 35 years and so we had to go out there and just literally take that thing apart and show the courts and the jury and the judge that this meter was this technology and we didn’t infringe anybody. When we got done, there was four questions about the patent and there was four questions about whether we had infringed it. First four questions, “did Kinze infringe their patent?” And the jury said no, all 4 questions. Then they said, “the four patents in question, were they valid?” Four more “no”s, “they weren’t valid.” S,o we walked away from that.
But, if I told you how many millions we spent fighting that, you’d say, “well who really won that?” It wasn’t them — and it sure wasn’t us either, because we spent millions and the attorneys the one that won. And that’s another one of my — don’t get me started any further, that’s enough said. Boy, do I have a tough time with when I see one of these guys advertising that you got a sore toe, call us, we’ll get you some money. And that’s all it’s about, money, money, money.
Mike Lessiter: So, back when the rear fold planter suit was going on and you were a much smaller company, was there ever any doubt you were going to get in the ring and fight that?
Jon Kinzenbaw: No, it just… they back you in a corner, what are you going to do? I wasn’t the kind of person who would let — never had a bully necessarily do it, but I learned a long time ago you don’t let them back you in a corner, you call his bluff on it.
Susie Veatch: You really rallied the employees around that moment because everything was on the line. Maybe tell him about the meeting you had with them all basically saying are we in this together or how…
Jon Kinzenbaw: Well, I don’t know, it was 150 employees, and I just told them what had happened. And then I said, “you know, Deere needs to know that if they can’t build — they were hiding behind they couldn’t produce enough.” They didn’t have the money, they didn’t have the parts and they didn’t have the facility. Three excuses not to produce row units and I told them employees, I said, “now we know that we can assemble more rows in a day than they claim that they can do with our workforce. So, we’re going to get the message across if they have more trouble, we’ll build their row units, too.” And the employees really got a kick out of that, the fact that I told them we could build theirs, too. When they had a strike we offered to build their row unit and they sent some guys in, but then they were afraid — I think they were afraid to admit and they tiptoed around it.
Susie Veatch: I think ultimately, though, our people really rallied around the fact that we’re in this battle that seems insurmountable because we’re very small by comparison, I think the book titles it David vs Goliath, but to see the employees rally around to see the community and quite frankly a lot of people were praying for us through that battle and the ultimate glory goes to God out of that, because there were just things that happened in that that we never could have orchestrated with our own human minds, but He literally led us through that battle and gave us the victory and allowed us to move on. Yes, it was a difficult time and the company and everything was on the line, but we really saw we can prevail through all of those around us working together with the Lord’s help and we’ve moved forward and we’ve grown a lot over the years.
And I think, too, in the face of adversity, adversity makes you strong. No matter who you are as a human being, whatever trial, adversity you’re facing you learn through that and you learn okay, am I going to stand up and go out and fight the battle or am I going to give up? And we did, and we won, and we’ve continued on. It’s been exciting, too, to see how even in the last 10 to 15 years that I’ve been back in the company, obviously I’ve grown up in it, but to see us continue to grow and continue to innovate and to lead the market in various planting innovations and to know the great products that we have that our name is on. It’s very different for I think a publicly traded organization, and Dad’s always said the name on the product is not the name of the man typically leading the company — but our last name is on it and so we wanted to live up to the expectations of quality and durability and again those are things that we talked about.
Mike Lessiter: Right. Learn a lot about your own people during a situation like that, right?
Susie Veatch: Yeah.
Mike Lessiter: And all the suppliers and dealers who were letting you know they were in your corner, you did a very good job of thanking those people in the book.
Jon Kinzenbaw: We had a supplier, numerous suppliers that came in when we were told that well our competitor — we can’t get this and we can’t get this and we just can’t — we don’t have the money, we don’t have the parts, blah-blah, there was a shortage of this, shortage of that. You know we went down the line and since we had the copy of that thing bolt by bolt, nut for nut, piece for piece to be successful, we did embarrass Deere. We bought every one of those parts except one that was supposedly they refused to sell it, it was proprietary. I’ll never forget the company. It was a little company that had a bearing and a sprocket and they said no, we build that for Deere and we won’t break that agreement. We went down the road and found another guy to make the part for us and got beyond it. And within 2 years, we found that the major company had breached that trust and had gone out to another supplier and they come back begging us to buy that bearing that they wouldn’t sell it to us 2 years prior. So, even that company bet wrong I think.
Mike Lessiter: We were talking about the dealers earlier. So in the early days did you go — were you going direct?
Jon Kinzenbaw: At a time, yes, we did. We sold in fact we used to sell the wagon with just a flat cash reward if they sold one. And we had dealers 10, 15 years later when I went to the dealer structure, the dealer would get a discount, he’d give it away, give it away here, the dealers get so mad, said I don’t know why you don’t just go back and give us a $500 allotment to selling a wagon. Then they’re all out there the same, they can’t cut the price, but they give away the 500, but that’s it. So, that was how that got started, before we had dealers we sold a few dealers in for $500. But, originally we sold all the wagons and all the planters direct to the farmer. In 1980 was when we first started putting in some dealers.
Susie Veatch: Yeah, you know, with the dealer network it’s exciting. Obviously, we’ve grown that over the years and every year for probably the last, oh 6 or 7 years, we go out annually and deliver market share awards to the top dealer in every district. But the one thing that we hear very often from dealers is that the Kinze brand is very profitable to them. And that’s one reason they choose to sell Kinze is obviously they have to make a profit, but then to have the brand name and the quality and the reputation that we have behind it. There’s going to be less and less dealers, but so long as there’s dealers out there that aren’t getting too much pressure from one brand or another to not take on other products, they very much desire to have the Kinze brand.
They hear from other dealers maybe Kinze line is a very profitable line, I want to have that line. We don’t put dealers on top of dealers, but as a whole the Kinze line is very profitable and then the Kinze products hold their resale value. And we see that time and time again, whether it’s at auctions, he goes to a lot of auctions, just was at one. So, those again are all great things for our dealer network because we need our dealers to sell and service our product, but it’s going to be a good business for them to be in as well.
Mike Lessiter: Right, because there is more pressure today than there was a few generations ago.
Susie Veatch: Yeah.
Mike Lessiter: You have to have that to withstand that.
Susie Veatch: Yeah. And you know when you look at, there’s really three of us that are major players here in the U.S., the red guys, the green guys and us, and we’re #2 in market share here in the U.S. And so in order for us to stay in that position, and in order for the farmer to put a blue planter behind a green or a red tractor, we have to have the innovative features that he desires and the planter that gets the job done in the narrow window of time he’s got to get crop in the ground and of course provides value to him as he trades and then buys a new one.
Mike Lessiter: I want to talk about your path to the company here. So, if you can kind of take me back from high school, when you started working in the company, and where you went after and came back. If you can kind of capsulate that timeline for us.
Jon Kinzenbaw: You’re going to tell him my story about…
Susie Veatch: I know why you’re laughing because you’re going to tell the story of my first job when I turned 14 and was able to actually have a job in the company, and my job at the time…
Jon Kinzenbaw: $5 an hour, 40 hours a week, pretty simple math, right?
Susie Veatch: Yeah, and at that time the accounting department they had a lot of paper that — everything was paper, we weren’t automated as much as we are today, and literally there were stacks of paper that had to be shredded. It was confidential stuff that we couldn’t just throw in the trashcan. So, my job, one of the main jobs was shredding paper and doing a lot of the grunt work as a first job. So, I’ll let him tell the story because he’ll tell it better.
Jon Kinzenbaw: Well, end of the — she had to wait 2 weeks to get a check for the first week because there’s always a delay, so she gets that $200 check but it was only 100-and-some dollars, and well where’s the rest of my money? Now, she sat at the supper table and we talked openly about taxes, withholding taxes, all those different things, but it didn’t affect her, right, because she didn’t think it come out of hers, she was expecting $200.
Mike Lessiter: Teachable moment.
Susie Veatch: That’s right, teachable moments. So, I guess growing up in the company and being involved in it from a kid and then those summers from the time I was 14 being able to work out there up through college. And then when I got into college I interned in other companies just to get other experiences as I got later in college. But those early years I eventually rotated throughout pretty much every area in the organization, which was good, too, to just understand and not do one thing. And, I always thought one day I might come back to the business, but Dad always said if you’re going to come back you need to go be successful somewhere else, which was good, I appreciated that, and I think our employees appreciated it, too. And for me it gave me so much more appreciation that when I did come back fulltime, when I came back in 2005 then after having been in college and work for Caterpillar and had a great experience at Caterpillar. But, you appreciate so much more what you have when you have a viewpoint of something else. I worked with great people there, but nothing holds a candle to the great people that we have in our business. Again, just all the through from our employees to our dealers, the whole network. And it’s fun, too, to come back as an adult, those people, those early dealers and early employees that have been there many years that I remember as a kid, that remember me as a kid, and then to come back and of course be involved at the level that I am now. So it’s been a fun journey and we’ve grown a lot over the last 10 years. Of course the last couple years we’ve been in this down ag market, but again we talked about adversity earlier, you figure out okay what do we need to do now to go and grow again and move in a forward motion. And it’s those times that you have the unexpected that really makes you think through and re-approach and try different things. And again we’ve got a great team of people, a great executive team as well that we work with because it’s much bigger than either he or I could run without the great team of people in the areas of expertise that they have and they advise us when we work together and make decisions, and that’s really what it’s all about.
Jon Kinzenbaw: So, she’s been back 16, no about 12 years, but I told her when I got 50 years in she could become president, and she didn’t forget that.
Mike Lessiter: How do you think each of you are similar in your approach and how do you think you’re different?
Susie Veatch: Yeah, well obviously there’s a lot of I think I’ve learned a lot just over the years by listening to him. And even we talked earlier about the dinner table conversation, those things that you learn to critically think as a kid, so we were always challenged to think business-minded like, even as kids, because that’s what we talked about at the dinner table. And the tremendous respect that I have for what he’s done and what he’s built. And then it was — to come back in and be involved — and we joked about the president title, but it’s like do I really want that title because that’s in a way that’s a really big responsibility and elevating my role even more so at least by title. Obviously, there’s a lot of things that I’ve been doing and that haven’t changed and I’ll keep doing. But to be able to work alongside him and learn and as we have different scenarios of things happen, to be able to have his eye of well, you know, I’ve got this many years of wisdom, experience to draw upon that I obviously haven’t had.
But every year now that I’m back and the longer that we work together there’s more that you start feeling comfortable with like yeah, that’s how Dad would handle it and that’s how I know he’d want us to make this decision as we work together because his role now, he’s able to take time to enjoy some of his hobbies and what he does so he doesn’t have to be involved in the level of detail in the day to day like I am. Yet when we make major decisions we include him and he very much has a say in those major decisions. But there’s a lot of day to day decisions that add up that could become major that you really have to make sure we are aligned as owners in the decisions that I’m making and I’m saying okay, how would he think through this and what would he want me to do in this situation. So, in that way I think I’m wired very similar to him in that the ability to critically think and to think through and what’s right. And in some scenarios they’re not black and white, whether it’s involving an individual, might be an employee situation where it’s not black and white and you have to make a fair decision, something you wouldn’t do for one that you wouldn’t do for all. That’s the difference of being private owners is being able to be involved in people’s lives.
And then obviously his area has been he loves the engineering and if he’s going to pop in we’ll usually find him down with the engineers or out in the proto shop. I enjoy the day to day business side and I think you’d say probably over the years, you didn’t enjoy some of the day to day administration stuff that I do, so that’s where we complement each other well. And then at the same time he’s worked really hard to mentor the team of engineers we have. So, some day when he’s not here, it’s not, “oh my goodness, he’s not here what do we do?” But they’ve been mentored and we’ve got a great team down there and a lot of expertise and they also know how he thinks when we design product, and again carrying that quality reputation forward and into the future and into the second generation.
Jon Kinzenbaw: She’s got the work ethic and the tenacity to hang in there and do that stuff, where a lot of people would be scared out I think. She’s learned to grab on and grab ahold and do it. But we also have both learned to surround ourselves with people that can do the things we can’t do. And if you’re afraid to hire somebody that’s smarter than you are, you got a problem. And if I needed somebody in accounting, we hired people that could do that and we’ve had good people and advisors from the accounting people, we have attorney, some of those we’ve had, hiring employees that can design and do tooling. I’m pretty — I’d be a pretty good tool maker now, but I learned that from employees. And there’s a lot of things that I’d be pretty good at now that I learned by watching or hiring people that can do it.
So you surround yourself with people that can get the job done. And if they can’t get the job done, you also got to be willing to part company because you can’t keep them all around. Once in a while you find a dead wood. An interesting thing that I always tell, I did it just here a while back, I said if you want to know whether this guy is working or not, you take 10 times at random, you’re out there if you’re the foreman, and you think about it, look and see what Sam’s doing. And you see him standing and jawing, you write that down. And then you wait a day or so and you happen to run into him again and you write down what he’s doing. If he’s standing and jawing you write that down. 10 times you go through that routine and how many times you catch him standing, talking versus getting the job done, is just about what you’ve got. It just almost without fail. We had a guy that was in a position he didn’t belong in, I’d been watching him for a long time, the foreman was over his head, he wasn’t even paying attention. I pointed it out, told him what to look for, and before I got back to see how he was doing, he’d gone from step 1 to step 2 and he had him back on the line; took him clear off of the job he was doing. And I said when you do that, you make sure you put him on a job you can measure. Don’t give him a job over here beside Sam and Sarah and let their numbers affect his. You get one that he does all by himself and you watch, and if his numbers are all alright, then fine, but if he’s dogging it you’ll know. And that sometimes you got to be tough when you do that, and I’ve known this guy for 40 years and I hated to put the pressure on, but I can’t afford to pay them guys. The other thing we find is when you do that with a what I call sometimes dead wood, a lot of the other guys will say oh, it’s about time. They’re sitting there watching this, too, but they don’t have the authority to say anything and they’re just waiting and hoping that you figure it out.
Susie Veatch: But in a business our size you occasionally have those situations, and as owners that’s probably one of the biggest challenge that can be the most draining. Anybody you talk to that owns a business where there’s people involved, when you have those issues, again for us fortunately they’re few and far between, but when you have them they are very draining because obviously to keep a great work environment for the others you can’t not deal with situations, otherwise it just creates a bad environment for even the good people that are working really hard.
Mike Lessiter: That’s a good segue into something I wanted to ask you guys. If someone was coming in and said, “Susie, describe what the culture is like within Kinze Manufacturing.” What are the words that pop into your head?
Susie Veatch: Well, that’s actually pretty easy because we talk about that with every interview candidate, we talk about it in all employee meetings, we talk about it in dealer meetings. But our culture is defined by our five core values. Integrity, excellence, innovation, customer focus and mutual respect. And we asked my dad and mom probably 20 years ago, they went on a vacation and we tasked them with coming back and defining what are the core values that Kinze was started upon and that are true today. And those were the values that they came back with and wrote a paragraph about each.
Now that’s not to say somebody won’t have a bad day, we all have bad days, but as a whole anyone interacting with Kinze should see those themes exhibited in their interactions. But those core values really are what defines our culture and what we’re all about. And you know that we hit 50 years 2 years ago, what’s the next 50 years? I don’t know, but I’ll tell you one thing, so long as we’re part of the family, those core values will be a part of our company in what we do and who we are.
Mike Lessiter: So, we’re in a succession transition change, like a lot of businesses are, and Jon Kinzenbaw has passed on to you the things that are must have’s for the business moving forward and there’ll come a day somewhere down the line where you’ll need to pass the keys to someone. What are the things that you’ll want that — if you’re writing a letter to your successor, the handful of things that are the non-negotiables that we’re going to do business this way, this is how we do it.
Susie Veatch: Yeah, I would go back to the core values and I’d really emphasize integrity, because that’s one thing that today seems to be lost in our culture as a whole. I mean there’s still a lot of great good people out there, but as a whole people seem more willing to compromise on integrity and you know it’s a slippery slope. You do one little thing here and you think oh, nobody will notice this, but then it’s like a big snowball that starts getting momentum going down a hill. And we encounter that a lot in our international business because many of the countries that we do business in, part of their culture is just assume you’re going to do an under the table deal and we make it very clear to our dealers internationally we will not do under the table deals. We will do everything above board and with integrity because that’s what we are all about. So that would be the thing I would emphasize the most because if you don’t have integrity, you might as well not have anything else because if people can’t trust their interactions with Kinze or with Kinze employees, then it’s pretty much game over no matter how great of a product you have or how customer focused you are because ultimately the customer isn’t going to trust doing business with us, they’ll go elsewhere. And so we take that really seriously and we know that that’s an important part of our lives as owners and that’s how we want others to interact with us and that’s how we want our people to interact with others is to always put that integrity first.
As business owners, the ultimate challenge is wanting to provide a good place to work for people in the community and support the livelihood of families. Obviously, we build a product and we’re in business to make money. Yes, there’s challenges, whether it’s people challenges or you get in a legal situation that’s a battle and a challenge or whatever it might be, but I think one of the things we always come back to is we’re fortunate to have we believe the best workforce that we could ever ask for right there in the Midwest, a lot of people that came from farms and understand how the product is used, the end product that they’re putting together. And then a great group of dealer network that really believes in our product and stands behind it and promotes it. Because we can promote our product there locally, but it takes dealers to expand that footprint and to be able to sell the product and the support to the end customer.
So, there’s been numerous challenges along the way that you’d have with any business, but the reward is always looking back and saying hey, not only are we building a great product that’s helping to feed the world, but we’re also able to provide a great working environment for a bunch of employees both here in Williamsburg and then we’ve got a global operation, a factory over in Vilnius, Lithuania, and another workforce over there. To be able now to expand that around the world, and even making the move to go from a distributor of our product globally to having dealers globally and now having that factory globally to be able to support the product needs over there. It’s exciting to see the growth and the changes and we put a lot of hard work into that and you take a risk, but in the end it’s very rewarding to see the results of that.
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