Talan Products Reaps Rewards of Inner-City Work Environment

May 24-30 1999
From Crain’s Cleveland Business

By David Prizinsky

At a time when inner cities are losing manufacturers to the suburbs, the owners and employees of Talan Products Inc. say the metalworking company’s West Side location is one of the keys to improving its operations.

“We see the inner city as a competitive advantage,” said Peter J. Accorti, vice president of operations at Talan, a 13- year-old company at 1985 W. 68th St. that has gained a reputation for rapid growth in a traditional, low-growth industry.

Talan was one of 100 small, inner-city companies in the United States cited for rapid sales growth in April by the Initiative for a Competitive Inner City, a nonprofit group in Boston that is an advocate of locating businesses in the inner cities.

Five other companies in Cleveland that made the group’s list were Thermagon Inc., Complete Personnel Management Inc., Colormatrix Corp., Ullman Electric Co. and Even Cut Abrasive Co. The group said lower real estate costs, closeness to customers and the availability of workers are among the advantages enjoyed by inner-city companies.

Talan ranked 73rd on the list, with sales growth of 123% from 1993 and 1997, when Talan’s sales were $8.2 million. Sales last year were just over $8 million, but are expected to be $10 million in 1999, Mr. Accorti said. Mr. Accorti said the company’s location directly influences its success.

“There is access to a workforce,” he said. “There is the central location that is close to highways, the airport and vendors. There is the availability of lower priced real estate.”

Talan has 37,000 square feet of manufacturing space in several buildings on West 68th. The company operates stamping presses and tube forming machine tools. It also makes aluminum extrusions.

The company’s inner city location isn’t the only edge it is trying to exploit. Since the end of last year, Talan has been implementing an “open book management” style that includes daily reports to the employees on the rates of machinery utilization and monthly reports that analyze the company’s operating profits.

As part of the “open book” approach, a team of 12 workers was formed to define key production measurementsand to identify the major impediments to improved equipment utilization.

“In the last five month, we have improved efficiencies by 20%,” said Pat Parziale, Talan’s vice president of manufacturing, who, along with Mr. Accorti and president Steve Peplin, is one of Talan’s three owners.

Talan measures efficiency by comparing the standard number of hours needed to complete an order with the actual hours taken. The open book approach also includes a profit-sharing program that is expected to pay a bonus this year of between 10% and 15% of Talan’s total wages.

Holly Harlan, a program director for the Westside Industrial Retention and Expansion Network, said Talan is known for innovation and hard work. She said the company invests in worker training and education.

“They’ve created an environment where the employees motivate themselves to work smarter,” Ms. Harlan said.

Mike Wimberly, Talan’s production manager, agrees. He described employee morale as good and said employees, including himself, think of themselves as part of a team.

“They are sharing the gains with everyone,” said Mr. Wimberly, a tool and die maker who started at Talan three years ago. “If they make money, we make money. The owners are working as hard as we are.”

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