General George S. Patton said, “Successful generals make plans to fit circumstances, but do not try to create circumstances to fit plans.” Generals and CEOs are alike in many ways, but here’s where they differ: CEOs not only strategize for the times but often make things happen by shaping their circumstances, as well.
Jim Pinto, CEO at AFS Corporate Member Wellman Dynamics––which makes castings for the Department of Defense, including every major helicopter program––may not think of himself as a general, but under his leadership, the foundry has emerged from bankruptcy and achieved the victory of a business-transforming Title III grant, only to be socked immediately by a shattering pandemic. But like its leader, Wellman Dynamics (Creston, Iowa), is a fighter that doesn’t stay down.
History will remember March 2020 as a blip in time that changed the world for over a year; Pinto also remembers it as the point when commercial aircraft engine business––40% of Wellman’s revenue stream––evaporated. When COVID-19 hit, Pinto had only been CEO for eight months, having navigated the company out of Chapter 11 in the spring of 2018; before being named CEO in July 2019, he had been an operating partner with Trive Capital, whose affiliate WDC Acquisition LLC bought Wellman out of bankruptcy. Not even those kinds of challenges, however, could equip a CEO for what was ahead––and no one could have seen the dark circumstances that would soon consume all his tactical planning.
“It’s been all about survival,” he said. “We went instantly into crisis management. There’s no course in college that teaches you how to prepare for a pandemic. COVID was the ninth economic event that I’ve managed through in my 40 years in manufacturing, but nothing has been quite as catastrophic as this one, because you not only have the economic downturn that you have to navigate through, but you have the potential of crisis getting inside your factory––employee health issues and potentially employee death.
“It’s not a situation where you pull out your traditional leadership book,” Pinto continued. “It’s more about how do you get through each week. How do you pay your bills? How do you get product out the door? How do you keep a workforce safe? And how do you manage through a crisis that doesn’t have a defined end date. The majority of my time here has been just trying to keep the doors open.”
Open it has remained, though Pinto is mindful the current calm could be disrupted by a virus resurgence. Disruption has almost been a defining characteristic of the foundry for more than a century. Wellman, officially called WDC Acquisition LLC, dba Wellman Dynamics, first opened its doors in 1910 in Cleveland and was called the Wellman Bronze Co. It was a well-established maker of magnesium castings by the ’30s and produced and shipped over 3 million lbs. of magnesium castings to the military during WW2. In 1961, Wellman acquired a company owned by Dow Chemical and relocated to Bay City, Michigan, and its name was changed to Wellman Dynamics. By the late ’60s, Wellman was making aerospace-grade aluminum and magnesium sand castings.
It merged with the Hills McCanna Corp. and relocated again in 1971 to the present facility 70 miles southwest of Des Moines. Fourteen years later, the foundry was bought by the Fansteel Corp., and yet another new moniker applied: Fansteel/Wellman Dynamics. It returned to the name Wellman Dynamics prior to falling on hard times and emerging from bankruptcy in 2018. Today, the foundry employs about 340 people and occupies 250,000 sq.ft. of manufacturing space; it also has purchased new property a few blocks away, the former site of the Ferrara Candy Co.
Through the decades and all its naming iterations, Wellman evolved into a critical supplier to the Department of Defense––so much so that the disappearance of the company was deemed almost inconceivable. While the company had applied for and received a recommendation as a recipient for a Defense Production Act grant in 2014, the grant didn’t receive presidential approval prior to Wellman’s bankruptcy in 2016, but in 2018 the company took another shot at it and was successful. Director of Sales Kandi Yrigoyen was the driving engine behind countless hours of fact-gathering and grant writing, which produced the winning application.
The second solicitation was released shortly after the Trump administration released ‘Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States under Executive Order 13806,’” said Yrigoyen. “Without specifically naming Wellman as a risk to the industrial supply base, it essentially said [if anything happened to us] we would be a risk to the industrial supply base and that we needed assistance in modernizing. When we applied, the solicitation had already received a presidential determination.
“Once Wellman was selected, things happened really quickly––we got a call and they said, ‘Can you be here next week?’ Five of us went to Picatinny Arsenal in New Jersey and sat down with people from the Army and the Title III program office,” she said. “After a lot of back and forth for six months, we finally executed the contract and went full steam. Some setbacks with the Coronavirus have impacted us financially, obviously, but we just completed three of the projects [itemized in the grant].
Wellman’s Title III grant totaled $15.579 million, and the foundry is required to match that sum dollar for dollar. Besides covering significant upgrades to its current facility, the funds are also earmarked for the creation of a second operation on the Ferrara property that will be a full-scale production aluminum castings facility––after effectively losing 2020, the timetable for completion is late 2024. Meanwhile, the existing building will convert to exclusive production of magnesium castings. Every grant must be affiliated with a flagship product, and Wellman’s new aluminum operation will be home to parts for the Sikorsky CH-53K King Stallion helicopter.
“We’ll go from operating what is a 1960s, antiquated facility to an upgraded magnesium plant, and a modern aluminum plant,” said Pinto. “Considering that with the next generation, heavy-lift helicopter there’s going to be an aluminum gearbox and transmission plus other programs that we’re quoting, there’s going to be quite a bit of aluminum work––in fact, we anticipate aluminum may be larger than magnesium toward the end of this decade.
“[The grant] is a very strategic investment for the reliability and sustainability of the supplier base for the Department of Defense, he added. “So, it’s a very high-profile, high-priority project for the DoD.”
Priority 1 in upgrading Wellman’s current building, said Yrigoyen, was addressing dated grounding and electricity, which has caused expensive repairs and downed equipment over many years. That completed, Wellman turned attention to its sand handling and in June finished installation of a new sand system. Outdoor sand silos, which have endured everything from 100 degrees and 100% humidity to -25 degrees and 0% humidity, have been replaced with an upgraded system and moved indoors for greatly improved consistency that will result in more consistent output from the core room as well the molding area.
Twelve dated magnesium furnaces––five of which were more than 50-years-old––are also on the checklist. Wellman broke the project in half to avoid shutting down the entire melt room at once, and the second phase of the furnace upgrading is now in progress. Additionally, in the layout and dimension department, a new Polyrix scanning system with multiple laser towers is a crowning feature among the foundry’s new improvements.
“We can actually scan a large part instead of doing it by hand or the old method of bluing up the casting and marking it off and doing a blue line,” said Wellman Product Engineer John Nish. “We scan the casting, make the model of that particular casting, and then we can overlay it to the model of the casting and project it back onto the casting to show exactly where any deficient areas dimensionally are. It’s just an amazing thing. Everybody that we take through there—even a person who doesn’t know anything about dimensional tolerancing—is in awe of this Polyrix system.”
For most of Wellman’s history, 80%–90% of its production has been magnesium, said Yrigoyen, but in recent years it’s received increasing orders for aluminum castings from its customer base. Till now, the foundry has managed to run both operations under one roof, but the Title III grant is finally giving Wellman the freedom to separate them into two unique facilities.
It’s been several decades since Wellman has done green sand casting—the company is a nobake dry sand operation now; no permanent molds. “We do hard tooling and advanced manufacturing including printed sand cores,” said Nish. “We make the cores, assemble the cores, pour the molten metal in, knock the sand off and start work on the casting.”
Wellman’s strength and importance as a military and commercial aerospace supplier lie in its unusual ability to produce not only large castings, but large and very complicated, intricate castings in low volumes. This was demonstrated in its AFS Casting of the Year award in 2006 for a Pratt and Whitney magnesium casting with many features and pipelines, as well as its AFS Honorable Mention in 2018 that was part of a broader program with numerous additive manufacturing components, Nish said.
“It’s not just the intricacy and size of the casting,” said Nish. “We take some pretty special requests for alloys; we’re doing a lot of beryllium-free alloys on the aluminum side, and those are challenging to work with but we do it and we do it well. On the magnesium side, we have some of the rare-earth alloys like the WE 43 alloy, which is also difficult to work with, and the EV 31 alloy, which is becoming the mainstay of the high strength-to-weight ratio for customers that want more high-temperature corrosion resistance.”
Keen on collaborative design for castability, Wellman has a soft rule for customer design engineers who are inexperienced in designing castings:
“We almost insist they come in to spend a day or two touring the facility, seeing what we do, because most of these guys don’t know that we’re pouring metal in the sand,” said Nish. “We get to teach people why they can’t do some of the things they want to do and teach them what we can do and still accomplish their goals. It’s an ‘ah-ha’ moment for them, and then they can go back to their CAD system and know, ‘Oh, that’s too thin a wall,’ or whatever it is. We don’t have to tell them anymore.
“As you can imagine, the less time we have to spend reworking the design 14 or 20 times and the less time we have to spend in those meetings, the more time we can dedicate to their design, casting the prototype, testing it out and actually getting them a product.”
Much More Than Button-Pushers
When the labor market went from tough to excruciating in 2020, Wellman, like the entire metalcasting industry, was faced with a host of issues, not the least of which included suspensions to budding partnerships with high school guidance counselors and program heads at local technical colleges as well as Career Services faculty at Iowa State University and University of Northern Iowa. While new equipment and facilities are both exciting and critical, attracting young people while retaining valued, experienced employees is a crucial game of wits—and Wellman is applying some key strategies to ensure its future success.
“This is a business that is defined by its people,” said Pinto. “We’re very dependent on hourly skilled employees as well as the technical engineering and quality people. Being able to acquire them and retain them over time, that’s what will define the success of the business going forward.
“Because of the very low volume, we don’t have what is traditional automation in the factory—much of what we do here we do by hand, and we do it with very skilled employees. For a company like Wellman, you’re not walking into a factory that’s filled with red and green buttons that you just press to load and unload parts all day. This is very technical and very complex. And we depend on those people sticking around, because the skills are learned over time. You don’t want to hire them and have them leave after a year because it’s very disruptive to the business.
“It’s been a challenge for us to be able to maintain the employment at the workforce levels we’re targeting, and to be able to attract people to apply for work when government programs are as generous as they are. It’s a new labor market, and, nationally, I think we’ll just have to see how it all plays out with the next generation of workers and what their expectations are for employment.”
On the recruiting side, Wellman will continue to emphasize local educational relationships. The company has also made a shift in how it advertises open positions, abandoning outreach to distant states and honing in specifically on winter-proofed Midwesterners whose roots are in the Iowa vicinity. If successful, a local radio host’s “Iowans Come Home” campaign initiative with the state’s development commission would only serve to bolster Wellman’s cause, Nish said.
As for retaining the talent already on the payroll, Pinto said he deliberately rejected the temptation to “attack” employee benefits, a common management impulse during economic crises. Offering a solid medical plan for health care and dental, Wellman provides what Pinto calls a blue-chip quality 401(k) that they’ve continued to match even during the downturn, as well as a generous tuition reimbursement program.
Getting recruitment back on track is one of Wellman’s Top 3 priorities for the coming 12–24 months. No. 2 is getting the Title III project completed with full buildout of the new aluminum facility. And No. 3 is the anticipated awarding and successful launch of a brand-new project the Wellman team expects to pop very soon after five years in planning—a project Pinto says will help sustain the workforce for the next decade, if not longer.
“It’s going to be very exciting for everybody to see a new program go into production,” said Yrigoyen. That’s one of the advantages of being in aerospace—usually our programs last 40 years. It’s a significant investment, and it’s a signal that there will be a long-term future for Wellman.”