A while back, there were a few articles that took a look at the business innovations being put into place at Marlin Steel. What were the innovations Marlin was making, and how did these news articles see them?
Insights from Global Trade
One article was by Will Swaim in the magazine Global Trade. In the article, Swaim covers some of Marlin’s history, such as how “Drew Greenblatt purchased Marlin Steel Wire Products, a 30-year-old company with a business model that worked until, suddenly, it didn’t.”
For a long time, Marlin’s core business was the manufacture and sale of cheap steel wire baskets to bagel stores. Marlin was so well-known for its commodity bagel baskets that it was known as the “King of the Bagel Baskets.”
However, the rise of low-carb diets slammed the bagel industry soon after Marlin moved to Baltimore. This forced many bagel businesses to close their doors, shrinking Marlin’s client pool dramatically. Worse yet, Chinese competitors started flooding the market with commodity baskets that were priced lower than the steel needed to make them.
It was a dire situation for Marlin Steel. As Greenblatt said in his interview for the Global Trade article, “We were floundering around getting hammered, just hemorrhaging cash. The world had changed and we were going to be extinct.”
Fortunately, things changed with the call from Boeing, and Marlin evolved from focusing on commodity/cost markets to focusing on creating high-quality baskets for engineering applications. As Swaim puts it in his article, “you won’t find Marlin manufacturing baskets for socks in Vietnam.”
The major takeaway from the article is that by focusing on quality rather than cost, Marlin was able to grow as a company and increase profits immensely as an American manufacturer during a time when the economy was experiencing a downturn.
Insights from The Washington Post
A more recent article by The Washington Post shows another reason for Marlin’s success beyond its newfound focus on working with the right markets: the Marlin Steel Job Skills Matrix.
In the article, the author goes over Marlin’s transformation from “a sleepy maker of wire baskets for bagel retailers such as Einstein’s and Bruegger’s into a fast-growing manufacturer of specialty precision metal fabrications.” The author goes on to say that “at the heart of the transformation at Marlin is ‘the matrix,’ a color-coded chart that hangs on the bulletin board just off the noisy factory floor.”
What is the “skills matrix?” In short, the job skills matrix is a chart that shows off what skills the company is looking for in employees and what skills each employee has. On this chart, everyone can see who has what skills and which skills are most needed by the company.
The kicker is that each skill on the chart has a pay increase attached to it: the more skills an employee masters, the higher his or her pay will be. This creates an incentive for employees to learn as many skills as possible to boost their base pay. Marlin even pays for the training, setting aside 5% of payroll to cover the cost of employee training.
Marlin Steel benefits from this because it makes it easier to get cross-trained employees who can work in more than one position. This means that if an employee working a key position takes a leave of absence, another one can cover for them.
Employees benefit from cross-training too. If one work cell, such as the sheet metal fabrication cell, is left without work to do, the employees in that cell can be reassigned to other, busier work cells until demand for sheet metal fabrication services picks up again. This means fewer layoffs and more consistent work schedules regardless of the types of work orders Marlin gets.
The results speak for themselves. As the Washington Post article puts it, “there’s nothing particularly special about the people who come to work at Marlin. The engineers are recruited straight from the University of Maryland… What they’ve accomplished, however, is special.” Since moving to Baltimore and enacting the skills matrix, Marlin’s annual sales have increased seven-fold to roughly $5.5 million a year.
The big takeaway from the WP article is that by investing in employees and providing training resources, Marlin has become able to meet ever-more-rigorous standards of quality for major manufacturing clients and build the company’s success by being far removed “from today’s standard management practice, which is all about competing on price, driving down wages and benefits for frontline workers and managing the business for cash.”
Marlin is proud to invest in employees, because it’s the frontline workers who are the backbone of Marlin’s success and ability to deliver “Quality Engineered Quick” to clients all over the globe.