Turn of the Screw
Hubert McGovern says people might wonder why a company would choose to manufacture screws in Agawam when they could be made far more inexpensively overseas.
“Twenty years ago, someone asked our board of directors why we hadn’t moved to China,” McGovern, president of OMG Roofing Products, told BusinessWest. “Many manufacturers have moved jobs overseas, and it’s no different in the screw business. But that’s not our story.”
Indeed, this story is a unique and a distinctive saga of success. OMG Inc. has created a line of specialty systems and products that have set it apart from its competitors, established a global presence, and recorded sales that totaled $275 million in the past year. Its products include screws for commercial roofing, hidden-fastening systems for residential decking and trim, hot-melt adhesive systems, log home fasteners, and insulation adhesives and related products used in the commercial and residential construction business.
“We’ve had a more than 10% annual compound growth rate since 1995,” McGovern said, adding that the company is a subsidiary of Handy & Harman Ltd., which is publicly traded on the NASDAQ Capital Market under the symbol HNH. “We make more than one billion screws per year, process approximately 150 pounds of steel every day, and consume 36 million pounds of carbon steel wire every year.”
The company’s growth and culture has been painstakingly crafted. Although safety is its top priority, the company is well-aware that its employees have played an enormous role in its success, and a great deal of time and energy are focused on ensuring they have opportunities to grow personally, financially, and professionally.
“People are the most important part of our company; we want our employees to be successful,” said McGovern. “We believe if they succeed and get ahead financially, they will feel good about working here, which will help the company do well and move forward. We know that our employees are behind all of our efforts.”
He added that, since stress can hinder performance at work, OMG has put programs in place to alleviate it that address wellness, physical health, and financial matters.
These include free exercise classes conducted in a large conference room or at a local gym during lunchtime and at the end of the day, periodic fitness and wellness challenges with awards, and a plethora of program offerings that range from swimming to yoga to TRX classes to accommodate people of different fitness levels.
Each year, the company also stages an ongoing series of events ranging from holiday lunches to raffles for highly sought-after sports-related tickets. including Patriots games and even the World Series.
“We go above and beyond to give people experiences they wouldn’t normally get,” McGovern said, before borrowing the well-known phrase “people don’t care how much you know until they know how much you care.”
OMG also offers Dave Ramsey’s Smart Dollar financial-wellness program free to its employees. It consists of 17 videos focused on personal finance that can be viewed online. Each one is about a half-hour in length, and topics range from budgeting to investing.
“Several people have been able to reduce their debt because of this program,” McGovern noted.
Professional development is ongoing, takes place on site and off, and is another important element of the company’s success. “We encourage people to push themselves, learn new skills, and take their own personal development to the next level by building on their strengths,” said Director of Communications Sam Everett, adding that the company also offers tuition reimbursement.
An employee of the month is also recognized; people can nominate themselves or their peers, and the winner (sometimes there are several a month) receives a jacket and monetary award.
Open dialogue and communication at all levels of the organization are an important part of the company’s culture; there are daily gemba walks through the factory to keep managers abreast of what is taking place at the manufacturing level.
“We’re always looking for ways to help people achieve their personal goals,” said Sarah Corrigan, director of Human Resources.
For this edition and its focus on manufacturing, BusinessWest looks at other measures that have helped OMG become a leader in the roofing and fastener industry, as well as what it has done to sustain that success.
Through the Roof
OMG was started in 1981 by Art and Esther Jacobsen, who named their business Olympic Fasteners Inc. They bought and sold screws for the commercial roofing industry, and in 1984, after experiencing great success, they moved the firm to Agawam and began manufacturing their own line of fasteners.
In 2000, the company name was changed to OMG Inc., and since that time, it has continued to grow by expanding the product line as well as its geographic footprint.
Today, the company employs more than 500 people, operates four manufacturing plants — in Agawam; Addison, Ill.; Arden, N.C.; and Rockford, Minn. — and has warehousing and distribution centers in Massachusetts, North Carolina, Illinois, Nevada, Canada, China, and Europe. It also has a team of nearly 60 field-sales representative across the country and in China and Western Europe.
However, the majority of employees work at the company’s headquarters in five buildings that contain 445,000 square feet, including 20,000 square feet of office and warehouse space in different areas of Agawam Industrial Park.
Since its beginnings, the business has been split into two divisions. The first is roofing products; that division specializes in insulation and membrane-fastening systems, roof-insulation adhesives, retrofit roof drains, pipe supports, as well as engineered edge-metal systems, and innovative productivity tools for low-slope commercial roofing applications.
Its second division is called FastenMaster, which makes a wide range of fastening systems and tools for residential applications.
Much of the firm’s ability to continue to compete in a global market is due to its product-development teams, which have created unique offerings.
They include RhinoBond, an advanced insulation and membrane attachment system based on induction technology that uses the same fastener and plate to secure both the insulation and waterproofing cover to a roof without penetrating the roofing material.
“We took induction technology and turned it into a tool to install commercial roofs,” Everett said, explaining that screws and washer plates are used to hold down insulation on roofs. The roofing material is placed on top of the insulation, then an induction tool is used to heat up the plates, bonding them to the membrane cover layer and holding the roof in place.
“Historically, insulation had to be screwed in place through the roof membrane or the waterproofing layer. But this product eliminates the need to poke holes in the roof, and because the attachment points are spread evenly across it, each fastener has to do less work to keep it in place when the wind blows,” Everett said, noting that the system is gaining popularity, and demand for it is growing.
Another product created by the FastenMaster division is its Cortex Hidden Deck Fastening System, which is used for PVC trim and on decks made of composite materials, such as Trex, to hide fastener heads so they are virtually invisible.
“We developed a screw called Trap-Ease with an integrated bit system that sets the screw depth and allows each screw to be covered with a plug stamped out of the exact material as the decking or trim,” McGovern said. “The product is gaining a very high market share and can also be used to secure trim on a house and the corners of moulding.”
He told BusinessWest that OMG practices lean manufacturing, which is a method of continuous improvement to eliminate waste and improve processes.
“It relies on participation by the entire organization,” he explained. To that end, small groups of employees are pulled from different departments on an ongoing basis to address problems and figure out how a process can be improved, which sets OMG apart from its competitors.
“The philosophy behind lean manufacturing has to be driven over several years to see results; it’s a journey that never ends,” McGovern added, noting that company officials also meet with employees in groups of 40 or 50 several times a year to communicate goals and performance initiatives.
The company is actively recruiting for 30 positions and plans to add an additional 20 jobs over the next several months; new positions will open in part due to a $15 million expansion underway in Agawam that will allow OMG to heat-treat its products in house instead of outsourcing the work.
A building that was used for warehousing is being converted into an area where the heat-treating can take place. Everett said the warehouse has been moved into space the company rented in the industrial park.
On Top of Things
OMG owes its success to its culture and efforts to set the company apart from competitors. And it has done well; it is the largest roofing-fastener supplier for commercial roofs in the country, and more than 65% of all commercial, industrial, and institutional buildings in the U.S. have one or more of its products on their roof.
“We’re a U.S. manufacturer, which is a pretty rare entity, so we have had to do something substantially different than just making screws and selling them,” McGovern noted. “We’ve focused on innovation, operational excellence, marketing, and creating a strong sales culture.”
And, of course, developing the people behind the scenes who are, after all, the driving force that has helped OMG secure its business in a rapidly changing world, and stay on top of things, as they say in the roofing business.