Wausau Equipment Company: a Lean Journey (a

UV1079

Rev. Mar. 1, 2010

WAUSAU EQUIPMENT COMPANY: A LEAN JOURNEY (A)

History and Business Background Ashford Elevator Company was founded in 1946 in a small midwestern town. Its first products were grain elevators, sold to local co-ops and farms. Started as a small shop with five workers, the company, which quickly grew to include 50 employees, began engineering, manufacturing, and servicing a variety of machinery and equipment for the agribusiness industry. The company changed its name to Wausau Equipment Company (WECO), and continued to expand through the 1960s and 1970s and, in the process, gained a solid reputation for the performance, quality, and reliability of its products, matched with its superior customer service and dependable field technicians. By the early 1980s, WECO was recognized as a national brand and began extending the scope of its business into foreign markets with its machinery and equipment. In 1981, it opened sales and service centers in Western Canada, followed by operations in South America and later Western Europe. Manufacturing plants were built or acquired in Brazil, Spain, and France, adding significant competitive advantage in delivered costs while maintaining the company’s reputation for excellent service and quality. In the mid-1990s, WECO undertook a major international-expansion campaign by opening two new plants in the Middle East and China to serve the growing agricultural markets in Asia and Africa. In 1993, WECO renamed its main division the machinery and systems division (MSD). At about the same time, it began implementing an active growth strategy whose focus was diversification from the cyclical and often uncertain agribusiness industry. Several acquisitions took place throughout the United States and Europe; the acquired companies had established histories and reputations and served the transportation and telecommunications infrastructure markets.

This case was prepared by Sorin Gruia of Resource Dynamics...