This article originally appeared onMichael Lobsinger, the Director of Business Growth Solutions and Manufacturing Extension Partnership at the Center for Economic Growth. . Guest blog post by
How a family metal-cutting company took flight with an expansion into the aerospace sector.
Greno Industries has served the metal cutting industry for 57 years. This woman-owned New York-based manufacturer of computer-numerical control (CNC)-machined parts supplies a variety of industries worldwide, including power generation, oil and gas, transportation, mining and food processing.
When changes in the oil and gas and power generation industries threatened to adversely impact Greno’s revenues, the company decided to expand into the aerospace & defense (A&D) industry. Greno’s leadership team knew that expansion into this industry would be complicated and the company would face more stringent certification requirements, but the A&D industry was the company’s best avenue for growth.
For this market expansion, Greno needed to upgrade its standard international quality management certification (ISO 9001) to a higher level with an additional 105 quality and safety requirements specifically for aerospace suppliers (AS9100 Revision D).
For assistance in obtaining and reaping the benefits of that new certification, Greno contacted the Center for Economic Growth (CEG), part of the New York Manufacturing Extension Partnership (MEP) and the MEP National Network. With the Center’s help, Greno received funding support in this endeavor from both the Workforce Development Institute and National Grid’s Manufacturing Productivity Program.
Three Greno employees, including President and COO Eileen Guarino, participated in VIA (ValueProp Interactive) Revenue Throughput classes offered by the Center. The classes took Greno employees through a hands-on revenue throughput analysis to uncover processes that were inhibiting growth. The classes helped Greno develop a systematic process to increase business with current customers and capitalize on opportunities from its anticipated certification upgrades. The classes provided Greno with a clearer understanding of both the company’s strengths and weaknesses and the competitors it would encounter in its new market.
Next, CEG performed a gap analysis to determine the company’s level of compliance with the higher certification. The gap analysis compared current processes against a standard set of AS9100D requirements and pointed out what Greno was missing in its current processes to meet the requirements. The gap analysis evaluated 42 elements, with Greno achieving compliant or partially compliant ratings for a majority of them. The gap analysis findings prepared Greno for the Stage 1 and 2 AS9100D audits. As a result of the gap analysis and changes the company made, the auditors discovered only one minor nonconformance, whereas the industry norm is two.
A month later, Greno became AS9100D-certified. The market expansion increased sales for the company, while the process improvements reduced costs. “It’s so process-driven,” Guarino said of the experience she had through the Center. “There’s a whole thought process going into a different market, so we’re not jumping around.”
Greno also took advantage of the National Institute of Standards and Technology (NIST) MEP’s Next Generation Supplier Program. Though this pilot program, the company met with representatives from several other original equipment manufacturers (OEMs) to learn about their requirements, expectations and opportunities. It also received a CoreValue Operational Assessment detailing the company’s enterprise value, value gaps and red flags, producing an actionable roadmap for growth. Working with CEG, Greno used the analysis to address bottlenecks, invest in new products and further improve operational performance.
The new certification resulted in:
- $600,000 in increased/retained sales.
- $120,000 in cost savings.
- $225,000 in new products.
Michael Lobsinger is the Center Director for the Center for Economic Growth's Business Growth Solutions (BGS) and Manufacturing Extension Partnership – Capital Region (MEP).