Imagine being named the captain of the most prestigious seafaring vessel in the history of the world. Sounds great, right? Now imagine being named the captain of the Titanic just minutes before it went from ocean liner to ice pick to instant cautionary tale.
Well, that’s not exactly what Todd Teske went through when he was named president of Briggs & Stratton in September 2008 and then CEO in January 2010, but he did have a fair number of icebergs to dodge, given the venerable Milwaukee lawn mower engine manufacturer’s strong link to the housing market.
As a business that’s tied more than most to housing, Briggs & Stratton saw its revenue trend line, which was pointing to the stratosphere in 2004, suddenly dip downward with the slowdown of the housing market in 2006.
| “We’ve never stopped being bullish on manufacturing in the U.S. Others are kind of coming around.” — Todd Teske, CEO, Briggs & Stratton |
“The real wakeup call for us was when the market was down two years in a row, then three years in a row, then four years in a row, then all of a sudden, wait a minute, we’ve never seen this, or at least in any of our lifetimes we’ve never seen this,” said Teske. “And that was an impetus then for change, because you do have a situation that, when things are going well, you get more in tune with, how do you make sure we don’t screw things up versus how do we keep this going and look for new and different opportunities?
“So success begets success, but sometimes success will ultimately result in, ‘I don’t want to do anything to mess this up.’ And we had to go through a few years where things weren’t recovering like they otherwise would, and that’s where all of a sudden we started making changes.”
Change will be the overriding theme of Teske’s presentation on Sept. 18, when he takes the stage as part of In Business’ Icons in Business series. As a student of history, Teske knows that it’s often those leaders who are handed the worst calamities — and who have to take bold action to weather those crises — who are most fondly remembered. He also has a keen appreciation for the burden placed on him in leading an iconic 105-year-old Wisconsin company.
“What you start to see are that times change, but patterns often remain the same. And so when you start looking at the need to change, and why people change, and what kind of successes you achieved after the change, that’s kind of what I want to talk about,” said Teske. “So the whole idea is to talk about the evolution of the corporate culture and how we’ve been changing it here at Briggs over the past several years, with an eye toward some of the different patterns that we’ve seen.”
Full speed ahead
Fortunately, Teske is not one of those leaders who’s allergic to change or bold solutions. He and his team have outlined a three-pillar strategy for moving the company forward. The first pillar is ensuring that Briggs & Stratton’s engine business continues to do well. The second involves getting into higher-margin products, such as commercial engines. And the third involves geographic diversification.
“That’s the one that came out of, in a big way, the economic downturn that hit the U.S. and really hurt the global economy,” said Teske. “You really want to make sure that you’re diversified and have many different eggs in your basket. Not that we’re going to shrink what we do here in the U.S. by any means, but I can tell you that that’s been a significant focus.”
Part of that focus involved the recent acquisition of Branco, a Brazil company that has given Briggs & Stratton a base of operations in Latin America. At the same time, the company remains overwhelmingly focused on domestic operations, with more than 85% of its production still based in the U.S.
In fact, the recent on-shoring trend in manufacturing looks like business as usual to Briggs & Stratton.
“We’ve never stopped being bullish on manufacturing in the U.S.,” said Teske. “Others are kind of coming around, if you will. I can understand why, because for a while there it was, ‘Let’s chase labor all over the world.’ And there are some products that are very conducive to chasing low-cost labor, and then there are other products like ours where, you know, about 10% of the cost of the engine is labor, and what we’ve been able to do over the past several years is get more productive with the workforce that we have. So we basically have more robotics, for example, in one part of our plant than perhaps we had in all of our plants when I joined the company 17 years ago.
“So what’s happened is robotics and other kinds of computer-controlled machining and manufacturing have made the U.S. worker much more productive, and we’ve seen it, we’ve done it, and that’s part of the reason we never had to leave to begin with, because we were able to work our way through that.”
But while Briggs & Stratton has been more dedicated than most when it comes to keeping jobs in the U.S., that doesn’t mean it hasn’t had to make tough decisions with respect to labor, particularly during the most harrowing days of the Great Recession. Asked what wisdom he would impart to business leaders who run everything from small businesses to large corporations, Teske immediately stresses the importance of finding good people, treating them well, engaging them, and working as a team. And that makes employment decisions all the more difficult.
(Continued)
“We actually closed a number of plants over the past several years, and that was not something that we normally did, and those were some really hard decisions,” said Teske. “People ask me all the time, you must really have to make some tough decisions. Yeah, the toughest ones are the ones that impact people’s lives, and when you shut down a plant or you reduce your head count, it’s really nobody’s fault that those people are going to have to go out and find a different job, and you know the impact you’re going to have on them, and you do everything you can personally and as a company to help them make sure they land on their feet. And those are the kinds of things that are necessary to make sure the organization can continue, and that’s where we’ve been over the last few years with some of the decisions that we’ve made. But we’re in a really good position now to take advantage of an economy that seems to be improving.”
But even though some of the decisions he’s been forced to make in guiding his company through the recent economic storm have been painful, Teske is keenly aware of the responsibility he holds in securing the future of this respected Wisconsin company.
“Words cannot express just how proud I am to be part of this company and the heritage of this company,” said Teske. “I like to think about it from the standpoint of, ‘How can we make this place better?’ So there are times when you have to make the really hard decisions. But then there are the other times that are a lot more fun where you go, ‘Okay, we’re going to go for it, we’re going to buy this company down in Brazil because that’s going to make this company better.’
“That’s where I really get a lot of enthusiasm and a lot of energy from, because it’s those things that I know are going to make this place better, and when it comes time to pass the torch to somebody else, I want to make sure we’re leaving this place better than when I came in.”
If you would like to see Teske speak at the Sept. 18 Icons in Business event, click here for information on registration and event details.
Click here to sign up for the free IB ezine – your twice-weekly resource for local business news, analysis, voices, and the names you need to know. If you are not already a subscriber to In Business magazine, be sure to sign up for our monthly print edition here.
