Onyx Power

Source: Manufacturing Digital

Date :11/04/2008 03:38:55

When you’re looking to grow your business, bigger doesn’t necessarily mean better. Exec learns that for ONYX Power Inc managing effectively is as important as managing more

Written by Ben O’Hanlon and Produced by Robert Tuneburg

Located in Santa Ana, CA, ONYX Power is a leading manufacturer of power products, from transformers to power distribution systems. Formerly part of MGE UPS Systems Inc, the company was formed in 2005 by the management buyout of MGE’s magnetic division.

Its two founders (Jeff Weiderkehr, Helen Hogle) transferred from the parent company along with 60 other members of staff after the purchase. Acting on a belief that the product set had unexplored potential, they brought with them a wealth of technical knowledge, built up over the past 30 years.

As President and CEO, Jeff Weiderkehr is responsible for ONYX’s overall operations; Alan Katz manages sales and marketing; whilst Helen Hogle is the company’s Chief Financial Officer. Helen says the immediate challenge was to expand ONYX’s customer base: “In 2005 we had one customer, MGE, so we decided to focus on developing our operations and increasing our product range knowing that an increase in service demand would follow.”

Operational Excellence

Three years later this strategy is paying dividends. ONYX has a healthy set of customers, an impressive product range and innovative plans for more. As under MGE, the company’s activities have focused on the high power magnetics market, building specialized transformers, DC to AC inverters and customized power management systems.

It manufactures the industry acclaimed TOPAZ inverter – a product that is used in critical environments such as telecommunications and data storage systems where reliability is essential. It also has some of the fastest lead times in the industry for manufacturing transformers, producing them in a matter of days. This is an impressive claim, particularly given that many are custom made and can be designed from scratch.

The company also manufactures inductors, a specialty which a lot of organizations can’t lay claim to. “We’re always looking ahead,” says Vijay Tendulkar, Chief Technology Officer at ONYX. “We become involved with the kinds of projects that most people wouldn’t touch with a 10ft pole.” It’s a bold approach, but one that has helped cement a strong reputation; these products have been trusted in some of the largest organizations, including those where reliability is paramount.

People Power

Built on a vision of “outstanding quality, outstanding customer service and innovation”, ONYX’s managers demand excellence from their employees. But this is very much a two way arrangement, with the company offering health benefits, annual bonuses and even monthly lunches in return. “We’re very much employee focused,” says Helen. “We have people with 20 years experience and more. These are valuable employees and we simply couldn’t do it without them.”

Vijay agrees that the company’s success is largely due to the experience of its employees: “The work we do is an art demanding high expectations. The transformer, for example, should be the most reliable part of a machine. It’s a skill that takes a long time to develop, so it’s very important that we look after our employees.”

Understandably, throughout the transfer ONYX’s management decided to protect all employee benefits and seniority that were in place at MGE. This was important given the current industry climate; there’s a shortage of electrical power engineers, with many choosing to specialize in the digital electronic market instead.

Safety First

The value placed on employees is also reflected in other ways, such as through ONYX’s rigorous approach to safety. For example, there is a weekly internal inspection whereby the President, Engineering Manager and Production Manager walk through the factory observing operations. This is part of an ongoing ‘look and learn’ culture, designed to keep safety at the forefront of everybody’s minds.

“It’s not enough to talk about safety,” says Vijay. “You have to constantly watch and be involved. By questioning people and pointing out if something’s wrong everyone can learn and improve. We believe that managers must be a central part of the safety team.”

This culture is supported by a safety committee, which meets every two weeks to consider potential improvements.

Going for Growth

With employee numbers set to increase, safety will remain an important priority; ONYX is currently investing in its sales force to support a strategic drive for growth. But as demand increases, the focus has turned to operations and the new pressures on product supply. New production lines will be incorporated into the company’s 62,000 square foot factory – acquired with a long-term vision in mind and therefore capable of handling the additional resource.

At present the company’s operations are concentrated towards the UPS (Uninterruptible Power Supply) and solar markets, but it aims to increase work in wind power, battery power and transportation. “The most important thing in managing growth is not making sure that you have enough people, but that you have enough of the right people,” says Helen. This is a necessity when delivering on the promise of meeting customer expectations on time.

The company is committed to “nothing less than the best customer service” and is keen to see that this continues with increases in production. It currently prides itself on a close customer relationship that cuts through the layers of management unlike many other organizations. This includes inviting the customer into the factory to see how operations are managed.

For ONYX achieving growth is unreservedly linked with providing good service. The focus is on becoming the best, not the biggest. It’ll be testing to maintain that across a wider customer base, but Helen says they’ll “take the challenges as they come” and it seems that, ultimately, bigger and better will go hand in hand.